UAE Firms Are Spending Billion Of Dollars To Expand Their Oil Operations
UAE energy firms are investing billions into new oil drilling operations, and are hoping to meet growing global demand. With several oil companies in the country, Adnoc which is UAE’s largest oil producer, has stated it will spend $127 billion between this year 2022 to 2026 to expand its oil operations and develop its low-carbon oil business.
In the mean time, other UAE energy firms are likewise hoping to extend their global impression too. They are poised to boost their oil output in the coming years, aiming to meet ongoing international demand as other world powers move away from fossil fuels to renewable alternatives.
The state-owned Adnoc is investing heavily in increasing its oil production by 2030. Last month it established a new debt issuing unit to manage project funding and increase production to around 5 million bpd by 2030, compared to 4 million bpd today.
To accomplish this figure, Adnoc says it would have to bore 700 drilld consistently every year. The new unit expects to intently screen market conditions and explore potential subsidizing valuable opportunities.
Adnoc, the UAE’s biggest oil producer, recently expressed it will burn through $127 billion between 2022-2026 to expand its oil projects and foster its low-carbon oil business. As of now, the country is known to hold stores of 111 billion barrels of oil and 289 Tcf of gas, which several companies are hoping to take advantage of, while it remains productive throughout the next ten years.
Adnoc is supposed to be the second most important brand in the Middle East and Africa locale after Saudi Aramco. This implies it has public confidence as it proceeds with expansion plans.
Not long ago, Adnoc awarded $1.94 billion to help its drilling operations. The funds have been split between Adnoc Drilling – getting the larger part – and US organizations Schlumberger, Halliburton, and Weatherford. This will subsidize wireline logging and hole services at the oil company’s coastal and seaward projects for a considerable length of time, with the decision to expand the venture for a further two years.
The framework agreements are a continuation of Adnoc’s unprecedented investment in services to enable the expansion of drilling activity required to responsibly unlock the UAE’s leading low-cost and low-carbon intensity oil as well as the nation’s gas resources.
Adnoc also signed a 10-year contract with France’s TechnipFMC for wellheads, trees, and services, at a cost of $1 billion. However, it is not the only UAE company looking to increase its oil operations.
This month, Dubai’s Dragon Oil announced a new oil discovery in Egypt’s Gulf of Suarez reserves, as it expands its foreign oil operations. The field is believed to contain around 100 million barrels of crude, marking one of the biggest discoveries in the region in the past twenty years.
Meanwhile, Dragon oil entered Egypt in 2019 when it procured BP’s Gulf of Suez resources. By 2021 it was producing an average of 60,000 bpd, with means to build this figure to between 65,000-70,000 bpd in light of the new revelation.
Abu Dhabi’s National Energy Company, Taqa also saw experienced growth last year as doubled its profits in 2021, achieving $1.63 billion compared to $760 million in 2020. Its oil production levels reached 122,400 bpd. This demonstrates the success of its 2030 strategy for sustainable growth and returns, according to the company.
And at the end of last year, Adnoc and TAQA announced a $3.6 billion project to decarbonize offshore operations in support of the UAE’s target for net-zero carbon emissions by 2050.
A first-of-its-kind sub-sea transmission network is expected to help reduce the companies’ offshore carbon emissions by around 30 percent. The move to produce lower carbon oil will also help the UAE maintain its place as an international oil major as several powers push for energy with lower greenhouse gas emissions.
As the UAE gives no indications of easing back in its oil production, organizations from Abu Dhabi and Dubai are growing their oil and gas operations both at home and abroad. Hugely investing in exploration projects is relied upon to expand the UAE’s output over the next decade, while moves to decarbonize will help the country to meet targets on its way to net-zero.