CSE, ADOSC, Habshan among Adnoc's $3.6bn drilling contracts
Companies will respectively represent Tenaris, Vallourec, and Marubeni to deliver one million MT of casing and tubing
Abu Dhabi National Oil Company (Adnoc) has awarded contracts to Consolidated Suppliers Establishment (CSE), Abu Dhabi Oilfield Services Company (ADOSC), and Habshan Trading Company – respectively representing Tenaris SA from Luxembourg, France's Vallourec SA, and Japan's Marubeni Corporation – to supply one million metric tonnes of casing and tubing – equivalent to the distance from Abu Dhabi to Houston – to support Adnoc's drilling activities, with the awards expected to add $1.8bn (AED6.6bn) to the UAE’s economy and create jobs for UAE nationals.
The contracts have a combined scope of $3.6bn (AED13.2bn) and mark the first in a series of drilling-related procurement expenditures with an overall value of $15bn (AED55bn) that Adnoc plans to make in the next five years, and is part of its $132.2bn (AED486bn) five-year capital expenditure approved by Abu Dhabi’s Supreme Petroleum Council (SPC) in November 2018.
Additionally, Adnoc said in a statement, the contracts have "the potential to achieve In-Country Value (ICV) of over 50%", including more than $100m (AED367m) in foreign direct investment, over the next five years, to establish an oil country tubular goods (OCTG) threading plant and repair centre, and a training academy in Abu Dhabi.
Adnoc said the contracts were awarded after "a robust tendering process that included a rigorous assessment of how much of the contract value would support the growth and diversification of the UAE’s economy" through Adnoc's ICV programme.
The combined scope of the awards is based on the forecasted requirement for casing and tubing across Adnoc Group.
Commenting on the contract awards, Adnoc’s upstream executive director, Abdulmunim Saif Al Kindy, said: “These agreements will provide Adnoc with increased flexibility to proactively respond to the demands of the evolving energy landscape as we ramp up our drilling activities and deliver our 2030 strategy.
“They will also generate substantial ICV and provide attractive foreign direct investment opportunities for the private sector, further demonstrating Adnoc’s commitment to creating sustainable value for the nation and its people, in line with the leadership’s wise directives,” he added.