meed-logo

line1 line2 line3
SIGN IN / REGISTER

Adnoc sees project spending uptick

25 April 2024

The latest news from the UAE's upstream sector includes:

> Contractor orders compressors for Adnoc project
> Adnoc Offshore awards Upper Zakum contract
> Contractors prepare bids for Lower Zakum oil project
> Adnoc Onshore awards contracts for well tie-ins packages
> Adnoc Onshore evaluates prices for fields upgrade
> Kent wins framework agreement with BP
> Dubai-based company wins Egypt oil contract extension

 

Abu Dhabi National Oil Company (Adnoc) spent close to $22bn last year on upstream projects, making it one of the best years on record for oil and gas project capital expenditure (capex) in the UAE, if not the top.

Adnoc and its partners in the Ghasha concession dominated spending in 2023, awarding contracts worth $16.94bn in early October for engineering, procurement and construction (EPC) works on the Hail and Ghasha sour gas production project.

The investment represents the largest-ever capex on a single oil and gas project in the UAE. It marks a giant leap for the country in its goal to become self-sufficient in natural gas production. As such, the project investment is also having a galvanising, trickle-down effect on the UAE oil and gas supply chain.

The Hail and Ghasha fields are part of Abu Dhabi’s Ghasha concession, which is expected to produce more than 1.5 billion cubic feet a day (cf/d) of gas before the end of this decade.

Adnoc holds the majority 55% stake in the Ghasha concession. The other stakeholders are Italian energy major Eni with 25%, Germany’s Wintershall Dea with 10%, and Austria’s OMV and Russia’s Lukoil, each with 5%.

A consortium of Abu Dhabi’s NMDC Energy and Italian contractor Saipem was awarded the project’s offshore EPC package. Its value is $8.2bn, with Saipem declaring its share to be worth $4.1bn. 

The scope of work broadly involves the EPC of offshore facilities, including facilities on artificial islands and subsea pipelines.

Italy-headquartered Tecnimont was awarded the onshore EPC contract. The $8.74bn contract relates to the EPC of onshore facilities, including carbon dioxide (CO2) and sulphur recovery and handling.

Robust spending

Adnoc is expected to maintain robust spending on upstream projects this year, if not match the 2023 level, as it strives to achieve its oil and gas production targets. The Abu Dhabi energy giant aims to attain an oil production capacity of 5 million barrels a day (b/d) by 2027 and become self-sufficient in gas production by the end of this decade.

Adnoc is understood to have already spent more than $2.3bn so far this year on projects deemed vital to reaching its crude production goal.

Adnoc Group subsidiary Adnoc Offshore awarded the main EPC contract in mid-March for a project to increase the oil production potential of Abu Dhabi’s largest producing oil asset – the Upper Zakum offshore field – to 1.2 million b/d.

UAE-based Target Engineering Construction Company won the contract for the project, which is estimated to be worth $825m. 

The main scope of work on the project involves the EPC of several surface facilities and plants at the Upper Zakum offshore development’s four main artificial islands of Al-Ghallan, Umm Al Anbar, Ettouk and Asseifiya – also known as Central Island, West Island, North Island and South Island, respectively.

Also in 2024, another Adnoc Group subsidiary, Adnoc Onshore, has awarded main contracts totalling more than $1.5bn for two packages on a project involving the conversion of wells and the installation of associated tie-ins at the southeast cluster of oil fields in Abu Dhabi.

Package 3 covers the EPC of well tie-ins and other associated structures at the Asab and Sahil oil fields, while package 4 relates to the Shah, Qusahwira and Mender fields.

Adnoc Onshore split the scope of work on packages 3 and 4 and appointed two contractors for each package.

Pakistan-headquartered Descon Engineering and Galfar Engineering & Construction Emirates, the UAE division of Omani contractor Galfar Engineering & Contracting, have won contracts for package 3, according to sources.

Galfar Engineering & Construction Emirates has also won a contract for package 4, while Abu Dhabi-based Al Nasr Contracting Company has secured the other contract, sources said. The combined values of the EPC contracts awarded by Adnoc Onshore for packages 3 and 4 are estimated to be $790m and $760m, respectively.

Upcoming tenders

Looking ahead, Adnoc Offshore is also preparing to issue the main EPC tender for a second phase of the project to increase the oil production capacity of the Upper Zakum field development.

Separately, contractors are preparing bids for a major project to boost oil production at the Lower Zakum offshore hydrocarbons concession in Abu Dhabi.

The Lower Zakum hydrocarbons zone is 65 kilometres northwest of Abu Dhabi in the Gulf’s waters. Adnoc Offshore holds the majority 60% stake in the Lower Zakum asset. Foreign partners include an Indian consortium of companies led by ONGC Videsh (10%), Japan’s Inpex Corporation (10%), China National Petroleum Corporation (10%), Italy’s Eni (5%) and France’s TotalEnergies (5%).

Adnoc and its partners in the Ghasha concession dominated spending in 2023, awarding contracts worth $16.94bn in early October for EPC works on the Hail and Ghasha sour gas production project

Adnoc Offshore’s larger, longer-term objective is to raise the asset’s output capacity to 520,000 b/d by 2027 and maintain that level until 2034. This strategic goal will be accomplished through the Lower Zakum Long-Term Development Plan (LTDP-1) project.

Adnoc Offshore issued the main EPC tender for the multibillion-dollar Lower Zakum LTDP-1 project in March. Contractors invited to bid have until the end of July to submit technical bids for the project, while commercial bids are due in September.

Adnoc Offshore intends to award EPC contracts for the Lower Zakum LTDP-1 project by the end of the year.

MEED's April 2024 special report on the UAE includes:

> COMMENT: Non-oil activity underpins UAE economy
> GVT & ECONOMY: Non-oil activity underpins UAE economy
> BANKING: UAE banks seize the moment
> DOWNSTREAM: UAE builds its downstream and chemicals potential
> POWER: UAE marks successful power project deliveries
> WATER: Dubai tunnels project dominates UAE pipeline
> DUBAI CONSTRUCTION: Dubai real estate boosts construction sector
> ABU DHABI CONSTRUCTION: Abu Dhabi makes major construction investments

https://image.digitalinsightresearch.in/uploads/NewsArticle/11705970/main.jpg
Indrajit Sen

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • WEBINAR: Saudi Giga Projects: Market Update for Q3 2026

    8 July 2026

    Webinar: Saudi Giga Projects: Market Update for Q3 2026 
    Tuesday 21 July 2026 | 11:00 AM GST  |  Register now

    Agenda:

    • Saudi projects market outlook and giga projects update
    • 2026 contract awards, project activity and market performance
    • Giga project reprioritisation, funding allocation and delivery progress
    • Key project announcements, milestones and market developments to watch
    • Major contracts awarded across construction, infrastructure and utilities
    • Upcoming tenders and contract award opportunities over the next 6–12 months
    • Geopolitical risks and their impact on project execution and investment
    • Progress across NEOM, The Red Sea, Diriyah, Qiddiya and New Murabba
    • Major non-giga project opportunities and growth sectors across Saudi Arabia
    • Short-, medium- and long-term outlook for the Saudi projects market
    • Audience Q&A

    Hosted by: Yasir Iqbal, MEED's construction editor

    Click here to register

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17588750/main.jpg
    Yasir Iqbal
  • Saudi Arabia eyes investors for $136m ferris wheel project

    7 July 2026

    Saudi Arabia is seeking investors to fund a SR511m ($136m) ferris wheel project, known as the Hijaz Eye.

    The project will be located in Medina and will cover an area of more than 33,000 square metres (sq m).

    According to information listed on the Invest Saudi platform, a database of about 2,200 state investment opportunities, the project is expected to have a significant impact on the local economy, offering an internal rate of return (IRR) of over 25%, with a payback period of seven years.

    The tender prospectus does not disclose the ferris wheel's height.

    The pitch to investors describes it as "the best destination to get a bird's eye view of the city", and frames it as an attraction aimed at pilgrims, with the project designed to "enrich the experience of pilgrims" and address a "growing need to increase cultural communication among pilgrims".

    The Hijaz Eye project is part of a broader initiative to establish Saudi Arabia as a leading tourism hub in the Middle East, and reflects Riyadh's growing push to lean on private capital, rather than public financing, for large-scale tourism infrastructure.

    Ain Dubai parallels

    The Hijaz Eye would not be the first giant observation wheel to be built in the region. The UAE's Ain Dubai, on Bluewaters Island, is currently the world's tallest observation wheel, standing 250 metres high – nearly twice the height of the London Eye.

    It is designed to carry up to 1,750 visitors in 48 air-conditioned cabins.

    Ain Dubai's budget was originally estimated at about $272m. The attraction opened in October 2021, coinciding with Expo 2020 Dubai.

    The project used about 9,000 tonnes of steel, more than was used in the construction of the Eiffel Tower, and required some of the world's largest cranes to lift its 1,805-tonne hub and spindle assembly, which is comparable in weight to four Airbus A380 aircraft.

    Despite its scale, Ain Dubai's post-opening record has been uneven. The attraction has closed and reopened several times since its debut, including a widely publicised reopening in December 2024.

    For the Hijaz Eye, the experience of Ain Dubai underlines a message that operational reliability will be central to whether the project can deliver on its projected 25%-plus IRR.

    Project positioning

    The Hijaz Eye is being positioned as an anchor for a specific strategic gap, which includes extending the time and spending of religious visitors to Medina beyond prayer and pilgrimage.

    Domestic and religious tourism sit at the core of the kingdom's Vision 2030 strategy, and the numbers underline why Medina, rather than a leisure hub like Riyadh or Jeddah, is a logical testing ground for private-capital tourism infrastructure.

    In 2025, Saudi Arabia's Tourism Ministry recorded 14 million overseas visitors that visited the kingdom for religious purposes, roughly twice the number of leisure travellers and seven times that of business travellers.

    A further 14 million domestic tourists travelled for religious purposes, of which 6.5 million visited Medina specifically.

    Image credit: www.cranebriefing.com

    READ THE JULY 2026 MEED BUSINESS REVIEW – click here to view PDF

    Stress test for Gulf aviation; Mixed performance as country outlooks diverge in the Levant; GCC tourism sector pivots from crisis to recovery mode.

    Distributed to senior decision-makers in the region and around the world, the July 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/17576184/main.jpg
    Yasir Iqbal
  • Worley announces Aramco project management consultancy deal

    7 July 2026

    Australian engineering firm Worley has announced it has been awarded a long-term agreement (LTA) by Saudi Aramco to support its projects within Saudi Arabia, mainly by providing project management consultancy (PMC) services.

    The five-year agreement is intended to support Aramco’s extensive capital programme – one of the largest sources of project investment globally, across the energy, chemicals and resources sectors, Worley said in a statement.

    Under the LTA, Worley will provide PMC services, including engineering and design, project development studies, detailed engineering, procurement support, project and construction management and technical expertise. It will also support capability building for local talent in Saudi Arabia.

    Worley was one of 11 local and foreign engineering firms selected by Aramco to create a new pool of PMC service providers, MEED reported in May.

    The Saudi energy giant signed LTAs with several companies for the PMC service providers pool at a ceremony at its Dhahran headquarters on 30 April. The agreements have a duration of five years, with an option to extend for a further three years. These companies were:

    • Engineers India (India)
    • Fluor (US)
    • IDOM (Spain)
    • KBR (US)
    • Kent (UAE)
    • Sinopec (China) / Sinopec Nanjing Engineering Company (China)
    • SNC Lavalin Fayez Engineering (Saudi Arabia) + McDermott (US)
    • Technip Energies (France)
    • Tecnicas Reunidas (Spain) / TR Saudia (local branch)
    • Wood (UAE)
    • Worley (Australia)

    “Importantly, this agreement supports Aramco to ensure critical infrastructure for ongoing energy, chemicals and resources supply for the domestic market in the Kingdom of Saudi Arabia as well as global markets,” Sydney-headquartered Worley said in a statement.

    Services will be delivered through Worley’s offices in Saudi Arabia and the UK, with support from global offices including the Global Integrated Delivery team.

    “The agreement requires Worley to leverage its digital capabilities, including artificial intelligence, augmented and virtual reality, digital twins, robotics and automation, digital scanning, and smart energy solutions, to improve engineering delivery efficiency in compliance with Aramco’s engineering and information security standards,” the Australian Securities Exchange-listed company added.

    Pool of brownfield EPC contractors

    In addition to selecting firms for its PMC services pool, Aramco also created a group of brownfield engineering, procurement and construction (EPC) contractors.

    Aramco awarded LTAs to the following 18 contractors for the brownfield EPC services at the same ceremony in Dhahran on 30 April:

    • Abdulhasan Group (Saudi Arabia)
    • Archirodon (Greece)
    • Bin Quraya (Saudi Arabia)
    • China Petroleum Engineering & Construction Corporation (China)
    • Engineering for the Petroleum and Process Industries (Egypt)
    • Engineering Procurement & Project Management (Tunisia)
    • Gas Arabian Services (Saudi Arabia)
    • GS Engineering & Construction (South Korea) / GS Construction Arabia (local branch)
    • Kalpataru Projects International (India)
    • Kent (UAE)
    • Larsen & Toubro Energy Hydrocarbon (India)
    • M R Al-Khathlan Company for Contracting (Saudi Arabia)
    • Max Streicher (Germany/Italy)
    • National Basics Company (Saudi Arabia)
    • New Horizons Contracting & Maintenance Company (Saudi Arabia)
    • Sinopec (China) / Sinopec Nanjing Engineering Company (China)
    • Technip Energies (France)
    • Tecnicas Reunidas (Spain) / TR Saudia (local branch)

    The scope of services covered under the LTA for brownfield EPC contractors includes the following activities across the kingdom’s Eastern Province and Shaybah areas:

    • Onshore oil/gas/water well tie-ins and hookups
    • Miscellaneous and capital projects
    • Site preparation
    • Power, communication, control, and security projects including Supervisory Control and Data Acquisition (Scada) systems and remote terminal units (RTUs)
    • Project management, engineering, fabrication, coating, procurement, material management and direct construction services
    • Testing, pre-commissioning, commissioning and mechanical completion
    • Camp and office construction, operations and maintenance
    • Modifications, improvements and upgrades to existing onshore facilities
    • Fencing and general onshore civil and structural works

    The LTAs for brownfield EPC works span seven geographical zones:

    1. Northern Area Zone NA-1: Includes plants, pipelines, wells and miscellaneous projects in Manifa, Safaniyah, Wasit, Abu Hadriyah, Fadhili and Khursaniyah.
    2. Northern Area Zone NA-2: Encompasses plants, pipelines, wells and miscellaneous projects in Berri, Abu Ali Island and Qatif.
    3. Southern Area Zone SA-1: Covers plants, pipelines, wells and miscellaneous projects in Dammam, Abqaiq, Aindar, Shedgum and Farzan.
    4. Southern Area Zone SA-2: Comprises plants, pipelines, wells and miscellaneous projects in Haradh and Harmaliyah.
    5. Southern Area Zone SA-3: Spans plants, pipelines, wells and miscellaneous projects in Khurais/Mazalij/Abu Zifan, Central Arabia/Hawtah/Layl, and Nuayyim.
    6. Southern Area Zone SA-4: Incorporates plants, pipelines, wells and miscellaneous projects in Hawiyah and Uthmaniyah.
    7. Shaybah Area Zone SHYB-1: Focuses on plants, pipelines, wells and miscellaneous projects in Shaybah.

    In addition to the newly created LTA pools for PMC services and brownfield EPC works – and excluding the GES+ engineering group – Aramco maintains two LTA contractor groupings for offshore and onshore oil and gas capital projects.

    READ THE JULY 2026 MEED BUSINESS REVIEW – click here to view PDF

    Stress test for Gulf aviation; Mixed performance as country outlooks diverge in the Levant; GCC tourism sector pivots from crisis to recovery mode.

    Distributed to senior decision-makers in the region and around the world, the July 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/17576189/main4243.jpg
    Indrajit Sen
  • Saudi Arabia sets July deadline for Taif International airport

    7 July 2026

     

    Saudi Arabia’s Matarat Holding, in collaboration with the National Centre for Privatisation & PPP (NCP), has set a deadline of 24 July for a contract to develop the new Taif International airport project in Mecca Province.

    The client has opted for a 30-year build-transfer-operate (BTO) contract model, including the construction period.

    In January, MEED reported that four consortiums and one standalone company had been prequalified to proceed to the next stage of the bidding process.

    These were:

    • Kalyon Insaat / AlBawani (Turkiye/local)
    • Mada International Holding / TAV Airports (local/Turkiye)
    • Tamasuk / Bengaluru International Airport (local/India)
    • Vision Invest / Asyad / DAA International (local/local/Ireland)
    • GMR Airports (India)

    The new Taif International airport will be located 21 kilometres southeast of the existing Taif airport and will have a capacity of 2.5 million passengers by 2030.

    In addition to a new airport terminal, the proposed design features a runway with a full-length parallel taxiway connecting to a single commercial apron.

    The scope includes facility buildings, utility networks, car parks and access roads, as well as provisions for additional expansions to meet future subsystem requirements.

    The new airport is expected to meet the projected increase in demand by 2055 and contribute to the economic development of the city of Taif and its surrounding areas, in line with the kingdom’s National Aviation Strategy.

    It is also expected to meet the needs of Umrah pilgrims, as an alternative within the region’s multi-airport system, which includes King Abdulaziz airport in Jeddah, Prince Mohammed Bin Abdulaziz airport in Medina and Prince Abdulmohsen Bin Abdulaziz airport in Yanbu.

    Previous tenders

    The Taif, Hail and Qassim airport schemes were previously tendered and awarded as public-private partnership (PPP) projects using the BTO model.

    Saudi Arabia’s General Authority of Civil Aviation (Gaca) awarded the contracts to develop four airport PPP projects to two separate consortiums in 2017.

    A team of Turkiye’s TAV Airports and the local Al-Rajhi Holding Group won the 30-year concession agreement to build, transfer and operate airport passenger terminals in Yanbu, Qassim and Hail.

    A second team, comprising Lebanon’s Consolidated Contractors Company, Germany’s Munich Airport International and local firm Asyad Group, won the BTO contract to develop Taif International airport.

    However, these projects stalled following the restructuring of the kingdom’s aviation sector.

    Saudi Arabia has already privatised airports including the $1.2bn Prince Mohammed Bin Abdulaziz International airport in Medina, which was developed as a PPP and opened in 2015.

    READ THE JULY 2026 MEED BUSINESS REVIEW – click here to view PDF

    Stress test for Gulf aviation; Mixed performance as country outlooks diverge in the Levant; GCC tourism sector pivots from crisis to recovery mode.

    Distributed to senior decision-makers in the region and around the world, the July 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/17574264/main2939.jpg
    Yasir Iqbal
  • KBR wins Iraq pipeline contract

    7 July 2026

    US-based KBR has been awarded a consultancy contract for a planned pipeline project that will extend from Basra in the south of Iraq to Haditha in Al-Anbar Governorate.

    Iraq’s cabinet, which met under Prime Minister Ali Al-Zaidi, has approved the award, according to a cabinet statement.

    State-owned Basra Oil Company (BOC), which manages the majority of Iraq’s southern oil fields, is now expected to sign a contract with KBR for the project.

    In April, Iraq announced the allocation of $1.5bn for the project, which is part of a larger scheme, estimated to be worth $5bn.

    The wider project includes additional pipeline links that will extend to Kirkuk in Northern Iraq and to Jordan.

    Earlier in July, Iraq's cabinet approved BOC signing a ​heads of agreement and a non-disclosure agreement with a consortium of companies to explore possible future oil pipeline projects, including the Basra-Haditha connection.

    The consortium includes US-based companies Chevron and TI Capital, as well as Qatar’s UCC.

    The consortium will prepare technical and financial feasibility studies for strategic export pipeline projects, according to a statement from Iraq’s cabinet.

    In June, Prime Minister Ali Al-Zaidi and US Special Presidential Envoy Tom Barrack agreed to advance the memorandum of understanding with TI Capital to rehabilitate a disused pipeline that extends from Kirkuk to Baniyas in Syria.

    READ THE JULY 2026 MEED BUSINESS REVIEW – click here to view PDF

    Stress test for Gulf aviation; Mixed performance as country outlooks diverge in the Levant; GCC tourism sector pivots from crisis to recovery mode.

    Distributed to senior decision-makers in the region and around the world, the July 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/17570453/main.jpg
    Wil Crisp