ADNOC Drilling has secured a $733 million contract by ADNOC Offshore, for three island drilling rigs to operate on existing and newly constructed innovative artificial islands at the offshore Zakum field for drilling and completion of wells.
“ADNOC Drilling is honored to receive this substantial award, which marks a significant milestone in our company’s accelerated growth journey. These new island rigs will be the most advanced in the world, embracing artificial intelligence, the most transformative technology of our generation,” said Abdulrahman Abdulla Al Seiari, Chief Executive Officer of ADNOC Drilling.
“Our partnership with Honghua Group (HH) will amplify the creativity and ingenuity of our industry as we design and build these rigs of the future that drive efficiency and safety and deliver exceptional value for our customer ADNOC Offshore,” Al Seiari added.
ADNOC Drilling and Honghua Group (HH), will integrate artificial intelligence (AI) in rig design improving safety and efficiency.
“ADNOC Drilling’s technical expertise and enhanced capabilities are key enablers as we safely and sustainably accelerate to meet the world’s growing energy demands. This award will strengthen our partnership in the future as we work together to harness AI and innovation to maximize energy, minimize emissions and unlock significant value for stakeholders,” said Tayba Abdul Rahim Al Hashemi, Chief Executive Officer of ADNOC Offshore.
The contract award is above medium-term guidance with accretive dayrates enhancing long-term contracted cash flow and earnings visibility, ADNOC drilling said in a press release.
The rigs are expected to be delivered and commence operations during 2026. The rigs will be designed and built as part of a partnership between ADNOC Drilling and HH.
This partnership has been specifically formed to harness the transformative nature of AI, digitization, and advanced technology in the design and operation of these next generation drilling rigs.
ADNOC Drilling and HH will also cooperate with AIQ, an Abu Dhabi based artificial intelligence (AI) pioneer contributing to the energy sector globally.
The design of the rig operating systems will utilize real-time condition, performance and utilization data to create actionable insights, enhancing rig performance and increasing efficiency, leading to improvements in safety and well delivery times.
Moreover, drilling operations on ADNOC’s innovative artificial islands create the ideal conditions for extended reach drilling (ERD) with the top five longest wells in the world being delivered from these islands off the coast of Abu Dhabi, the most recently delivered being over 52,000 feet.
The rigs will be built to deliver extended reach drilling (ERD) as well as having the state-of-the-art capability of walking between wells eliminating the need for the rigs to be dismantled to be moved. These capabilities dramatically improve efficiency and safety while vastly reducing costs and emissions.
The total capital expenditure for the purchase of the new island rigs is approximately $210 million, primarily allocated for 2025, with the first full-year revenue expected in 2027. The full-year 2024 guidance for the Island rig segment, currently operating 10 island rigs, remains unchanged at $200-250 million.
By 2026, the ADNOC Drilling fleet is projected to total at least 148, including these three new rigs and three previously announced land rigs for the initial phase of unconventional development. Since its IPO in the fourth quarter of 2021, ADNOC Drilling has invested over $2.2 billion in building one of the largest integrated drilling fleets globally, demonstrating its commitment to innovation, sustainability, and growth.
