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Adnoc builds long-term oil and gas production potential

7 April 2026

 

Between 2023 and 2024, Abu Dhabi National Oil Company (Adnoc Group) spent an estimated $37bn on projects critical to achieving its upstream targets: increasing oil production capacity to 5 million barrels a day (b/d) by 2027 and attaining gas self-sufficiency by the end of the decade.

The state energy company spent more than $22.5bn in 2023 alone, marking the highest annual oil and gas project spending on record in the UAE. The Hail and Ghasha sour gas development – accounting for approximately $17bn – remains the single-largest contract award in the country’s hydrocarbons sector.

A slowdown in capital expenditure (capex) following two years of elevated spending is therefore in line with expectations. While engineering, procurement and construction (EPC) contract awards for upstream projects declined in 2025 and into this year, Adnoc has still committed close to $10bn over the past 15 months.

The largest award during this period came from Adnoc Offshore, which let contracts worth $7.5bn for three EPC packages under the Lower Zakum Long-Term Development Plan (LTDP-1). Spain’s Tecnicas Reunidas and Abu Dhabi-based NMDC Energy and Target Engineering Construction Company were selected last February to execute the works.

The Lower Zakum field, located 65 kilometres northwest of Abu Dhabi, is majority-owned by Adnoc Offshore (60%). Other stakeholders include an Indian consortium led by ONGC Videsh (10%), Japan’s Inpex (10%), China National Petroleum Corporation (10%), Italy’s Eni (5%) and France’s TotalEnergies (5%).

Adnoc Offshore aims to increase production capacity at Lower Zakum to 520,000 b/d by 2027 and sustain that level through 2034.

Offshore contracts in 2026

So far this year, Adnoc Offshore has awarded contracts for two key projects: the Satah Al-Razboot (Sarb) deep gas development and the expansion of the Nasr oil field.

Adnoc achieved final investment decision (FID) on the Sarb project in January and awarded the main EPC contract to US-based McDermott International. The contract is estimated to be worth around $500m, sources told MEED.

The project is expected to deliver 200 million cubic feet a day (cf/d) of gas by the end of the decade – enough to power more than 300,000 homes.

The scope includes the EPC of an offshore wellhead tower with four gas production wells, which will be connected to Das Island for processing through Adnoc Gas facilities. Works also include the installation of pipelines and intra-field connections linking the Sarb field to Das Island.

Also in January, Adnoc Offshore awarded McDermott a $942m contract for the Nasr-115 project, which will increase production capacity at the Nasr offshore field to 115,000 b/d. The field is located about 130km northwest of Abu Dhabi.

McDermott’s scope covers full EPCI services for two topside structures, a new manifold tower, a jacket, a bridge, associated pipelines, subsea cables and brownfield modifications.

Strategic projects in queue

Over the next 12-18 months, Adnoc’s upstream spending is expected to shift from meeting near-term production targets –now largely within reach – to building longer-term capacity beyond 2030.

Following $1.3bn in EPC awards in 2024 for the Upper Zakum expansion to 1.2 million b/d, Adnoc Offshore is advancing the next phase, which will increase capacity to 1.5 million b/d.

Located 84km offshore, Upper Zakum is the world’s second-largest offshore oil field. Adnoc Offshore has divided the EPC scope into three packages, with contractors submitting commercial bids for the UZ1.5MMBD project in February.

Adnoc Offshore is also progressing the Umm Shaif gas cap and surface pressure boosting project, aimed at increasing gas production by 550 million cubic feet a day (cf/d) and condensate output by 50,000 b/d. About 520 million cf/d of additional gas is expected to be fed into Adnoc’s sales gas network.

The first phase of the project has been split into three EPC packages:

  • Offshore package 1: fabrication of a 30,000-tonne gas compression system
  • Offshore package 2: fabrication of a 30,000-tonne gas compression system
  • Onshore package: EPC of gas inlet and processing systems at Das Island

Adnoc Offshore is currently evaluating commercial bids submitted in February for these packages.

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Indrajit Sen

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