In an exclusive interview with Oil & Gas Middle East, CEO of ADNOC Drilling Abdulrahman Abdulla Al Seiari, discusses the company’s fleet expansion, first-quarter results, and increased decarbonisation focus.
Can you discuss what projects/plans are in the pipeline for ADNOC Drilling?
The pipeline of opportunities in Abu Dhabi is vast and remains our number one priority. Building and maintaining production capacity requires a continuous high level of drilling and completion services activities. Additionally, the UAE’s aspirations of gas self-sufficiency and the development of unconventional resources will drive our domestic longer-term growth.
The expansion of our operations beyond borders is a component of our mid to long-term strategy and we are ambitious and constantly evaluate opportunities for growth.
Can you outline some highlights of ADNOC Drilling’s Q1 earnings results?
Following on from a record 2022, our strong first-quarter results leave us well-placed for another very strong year.
The drilling and completion services that we provide to ADNOC are pivotal to enable their production capacity growth. The first quarter revenue increased to $716 million, up 19% year-on-year. Growth in revenue was achieved across all segments, with Offshore Jack-up and Oilfield Services leading the way, increasing 28% and 43% respectively. EBITDA growth tracked the uptick in revenue, also increasing 19% to $333 million. Net profit for the quarter reached $219 million, up 25% year-on-year.
Can you discuss ADNOC Drilling’s fleet expansion and the company’s focus on decarbonising operations?
To responsibly meet the growing global demand for energy, ADNOC brought forward its production capacity growth targets from 2030 to 2027. As the key enabler of this accelerated production capacity growth, we are bringing our work program forward by three years that will benefit the UAE and our shareholders.
In 2022, our fleet expansion program led to 16 rigs being added to the fleet and us operating 115 rigs, the highest-ever number, establishing one of the world’s largest drilling and well completion fleets in the world. Based on our accelerated activity, our owned fleet will grow to 142 rigs by 2024, and with these additional rigs will come additional revenue.
As we continue to build capacity to enable ADNOC’s growth, our fundamental commitment is to support the delivery of maximum energy with minimum emissions, in support of ADNOC’s goal of reducing greenhouse gas emissions intensity by 25% by 2030.
Our decarbonisation plan rests on three broad streams of complementary activity:
- Continually driving greater efficiencies—through Integrated Drilling Services (IDS) we create greater efficiency through the drilling and completions process, increasing effectiveness right across the value chain. Fundamentally, more efficient drilling means reduced operational emissions
- Minimising the emissions of our drilling fleet. We are adding batteries to our fleet so providing hybrid power, these hybrids powered drilling rig can reduce emissions by up to 15%. Additionally, we are connecting our rigs to the grid where infrastructure allows, including 100% of our island rigs
- Addressing emissions associated with the global supply chain – by supporting local manufacturing and procuring equipment and services from within the UAE we decarbonise our supply chain
How is ADNOC Drilling supporting the UAE’s plan to become gas self-sufficient?
While ADNOC’s accelerated production capacity growth will deliver big gains for ADNOC Drilling in the short to medium term, it is the plan to unlock Abu Dhabi’s ‘’unconventional’’ oil and gas resources as well as to deliver gas self-sufficiency for the UAE that will cement long-term earnings potential.
Please discuss ADNOC Drilling’s contract activity in 2023?
Since our initial public offering in October 2021, we have secured more than $12 billion in contract backlog. In April this year we were awarded a $412 million IDS contract which will be the first of a number of significant awards anticipated this year.
