meed-logo

line1 line2 line3
SIGN IN / REGISTER

Offshore oil and gas sees steady capex

6 March 2025

 

This package also includes: Saudi Arabia to retain upstream dominance

With nearly half of the Middle East and North Africa’s (Mena) hydrocarbons reserves located in offshore basins, regional oil and gas producers spend significantly on maintaining and ramping up production levels. Offshore projects are predominantly geared at raising drilling capabilities, expanding subsea infrastructure and building floating production systems.

In addition to boosting production capacity, producers also invest in offshore projects to improve technological innovation, safety and environmental sustainability. 

Capital expenditure (capex) on offshore projects in the region has remained steady in the past 10 years, with 2024 being one of the best years on record, witnessing total project spending of $23.5bn.

Qatar’s offshore goals

Qatar accounted for the largest capex on offshore oil and gas projects in Mena last year, according to data from regional projects tracker MEED Projects. The country invested more than $12bn in projects to produce incremental volumes of gas from its North Field reserve, as well to sustain its crude output.

In January 2024, North Oil Company awarded $6bn-worth of engineering, procurement and construction (EPC) contracts for a third capacity expansion project at the Al-Shaheen offshore field, to boost oil production by about 100,000 barrels a day (b/d).

North Oil Company – a joint venture of state enterprise QatarEnergy (70%) and France’s TotalEnergies (30%) – has been operating the Al-Shaheen field since July 2017. Situated 80 kilometres (km) north of Ras Laffan, at a water depth of 60 metres, Al-Shaheen holds one of the biggest oil reserves in the world and is Qatar’s largest field. It has a production potential of 300,000 b/d and accounts for about 45% of the country’s total oil production.

Meanwhile, Qatar’s North Field liquefied natural gas (LNG) expansion requires state enterprise QatarEnergy to pump large volumes of gas from the North Field offshore reserve to feed the three phases of the $30bn-plus programme. QatarEnergy has invested billions of dollars in EPC works on the two phases of the North Field Production Sustainability (NFPS) project, which aims to maintain steady gas feedstock for the North Field LNG expansion phases.

QatarEnergy LNG, a subsidiary of QatarEnergy, awarded Italy’s Saipem an order valued at $4bn for combined packages Comp3A and Comp3B of the NFPS Offshore Compression Programme’s second phase in September last year. The scope of work on the packages encompasses the engineering, procurement, construction and installation (EPCI) of six platforms, approximately 100km of 28-inch- and 24-inch-diameter corrosion-resistant alloy rigid subsea pipelines, 100km of subsea composite cables, 150km of fibre optic cables and several other subsea units.

The job for combined packages Comp3A and Comp3B is Saipem’s latest contract award as part of the NFPS scheme. The Italian contractor has secured work totalling almost $6bn on the two phases of the project.

UAE pushes offshore

With Abu Dhabi National Oil Company (Adnoc Group) striving to attain an oil production capacity of 5 million b/d by 2027 and become self-sufficient in gas production by the end of this decade, offshore oil and gas projects have received a significant boost. Adnoc was the second-highest spender on offshore projects in the region last year, as well as in the past 10 years. 

In 2024, Adnoc Group subsidiary Adnoc Offshore spent about $6bn on major programmes to potentially increase oil production, such as the two phases of a project to raise output from the Upper Zakum offshore concession in Abu Dhabi to 1.2 million b/d.

In April last year, Adnoc Offshore awarded the project’s main EPC contract – known as UZ 1.2MMBD EPC-1 and worth $825m – to UAE-based Target Engineering Construction Company. In November, Target also won the contract for the project’s next phase, known as UZ 1.2MMBD EPC-2, which is understood to be valued at $500m.

Also last year, Adnoc Offshore awarded a contract, estimated to be worth $2bn, for a project to increase production from the Umm Shaif offshore oil field in Abu Dhabi. 

US-based oil and gas contractor McDermott International won the main contract for the Umm Shaif Accelerated Development project, which aims to increase the Umm Shaif oil field’s output from about 275,000 b/d to 390,000 b/d by 2027, and to sustain that level of production until at least 2036.

Aramco maintains capex

In January 2024, the Saudi Energy Ministry directed Saudi Aramco to abandon its campaign to expand its oil production spare capacity from 12 million b/d to 13 million b/d by 2027. As a consequence of that government decision, Aramco cancelled the tendering process for at least 15 schemes involving the EPCI of structures at offshore oil and gas fields. 

Aramco has since changed tack, spending an estimated $5bn in 2024 on offshore EPCI contracts and earning third place in the league table of highest offshore spenders in the Mena region last year. 

Saipem was the biggest beneficiary of Aramco’s offshore spending, winning five of the eight Contracts Release and Purchase Orders (CRPOs) awarded last year.

In May, Aramco awarded Saipem the contract for CRPO 143, which involves replacing an oil line between the Berri and Manifa oil fields in the kingdom’s Gulf waters.

Aramco then awarded Saipem the contract for CRPO 138, which involves laying a trunkline at the Abu Safah offshore field. The contract is estimated to be worth $500m.

The Milan-listed contractor then scooped three CRPOs in August, starting with CRPOs 132 and 139, the combined value of which is estimated to be about $1bn. In September, Saipem began work on the two contracts, which involve the EPCI of structures to upgrade the Marjan, Zuluf and Safaniya offshore field developments.

Just days after the award of CRPOs 132 and 139, Aramco awarded Saipem CRPO 127, a $2bn contract that involves the EPCI of topsides and jackets for wellhead platforms, a tie-in platform jacket and topside, rigid flowlines, submarine composite cables and fibre optic cables at the Marjan oil and gas field.

In late November, Aramco awarded three further CRPOs worth more than $500m. China Offshore Oil Engineering Company won CRPOs 149 and 152, which are estimated to be valued at $30m and $250m-$300m, respectively. UK-based Subsea7 secured CRPO 153, which is understood to be valued at $200m-$250m.

Positive outlook

Regional national oil companies, particularly those in the Gulf, will seek to maintain a steady stream of investment in offshore projects this year, capitalising on the favourable oil price environment in pursuit of their goal of ramping up output potential in the mid to long term.

Their international counterparts are also likely to press ahead with projects to derive maximum value out of their offshore hydrocarbons assets in the Mena region, a large portion of which are located in prolific, shallow-water formations, making the production of oil and gas more cost-effective than in other regions.

Capex on offshore oil and gas projects this year may well match the level seen in 2024, according to MEED Projects data. In the first two months of 2025, offshore EPC contract awards reached $7.5bn.

Adnoc Offshore accounts for that entire spend through its Lower Zakum Long-Term Development Plan (LTDP-1) project. The company’s long-term objective is to raise output capacity at the Lower Zakum offshore hydrocarbons concession in Abu Dhabi to 520,000 b/d by 2027 and maintain that level until 2034.

Spanish contractor Tecnicas Reunidas and Abu Dhabi-based contractors NMDC Energy and Target Engineering Construction Company have been selceted by Adnoc Offshore to execute EPC works on the three main packages of the Lower Zakum LTDP-1 project.

Separately, Aramco is in the bid evaluation and tendering stages with a total of 12 more CRPOs. The biggest of these offshore tenders are a set of four CRPOs – numbers 145, 146, 147 and 148 – that are part of a project to further expand the Zuluf offshore field development.

These four CRPOs, estimated to be worth about $5.8bn, involve the EPCI of several structures at the Zuluf field, to maintain and raise its long-term oil and gas production potential.

In addition to CRPOs 145, 146, 147 and 148, entities in Saudi Aramco’s Long-Term Agreement (LTA) pool of offshore contractors submitted bids last year for CRPO 150 – an estimated $50m tender that involves the installation of structures at Aramco’s Northern Area Oil Operations.

In December, Aramco issued seven more CRPOs – 154, 155, 156, 157, 158, 159 and 160 – for which its LTA contractors are in the process of preparing bids. Work on these tenders relates to EPCI on structures at several offshore oil and gas fields in Saudi Arabia.

Aramco has been the biggest spender on offshore oil and gas projects in the region in the past 10 years, with capex exceeding $48.5bn. The world’s largest company is predicted to spend significantly on offshore EPC projects in 2025, too.

Saudi Arabia to retain upstream dominance

https://image.digitalinsightresearch.in/uploads/NewsArticle/13451668/main.gif
Indrajit Sen

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

Click here to register
Exclusive from Meed
Related Articles
  • Egypt prepares to tender five water treatment plants

    25 May 2026

    Egypt is preparing to tender five seawater desalination and industrial wastewater treatment plants under its public-private partnership (PPP) programme.

    The projects will be offered to local and international investors through competitive PPP tenders, Atter Hannoura, head of the PPP unit at the Finance Ministry, has told a local Arabic news channel.

    The first of these involves a plant in the Suez Canal Economic Zone, which will be launched “immediately after the Eid Al-Adha holiday”, Hannoura said.

    In January 2025, MEED exclusively reported that SCZone Istithmar had invited interested firms to prequalify to bid for a contract to develop a seawater desalination plant in the Suez Canal Economic Zone.

    SCZOne Istithmar is wholly owned by the General Authority for Suez Canal Economic Zone.

    The Finance Ministry’s PPP Central Unit, along with the European Bank for Reconstruction & Development, is supporting SCZone Isthithmar in the project’s tender proceedings.

    The opportunity entails a long-term water-purchase agreement to design, finance, build, operate, maintain and transfer the plant’s ownership.

    It was previously reported that this planned seawater desalination plant will have a capacity of 250,000 cubic metres a day (cm/d). 

    Hannoura added that the government is in negotiations with several companies, including Saudi Arabia-based Acwa, regarding large-scale desalination projects.

    Additionally, the government plans to tender four industrial wastewater treatment plants, with the first two projects expected to be launched “within 45 days”.

    One of these will be located in the Amreya industrial area in Alexandria, while the other will be in the Abu Rawash area in Giza, Hannoura said. Details of the other projects were not disclosed.

    Alexandria wastewater treatment plant

    The Authority for Potable Water and Wastewater is planning to build a wastewater treatment plant in eastern Alexandria.

    The $150m facility will have a water treatment capacity of 300,000 cm/d.

    In June 2025, Egypt’s government approved a financing and grant agreement for the project, with financing from the French Development Agency amounting to €68m and a grant of €2m.

    Expression of interest documents were previously submitted in September 2024.

    The main contract for this plant had been expected to be released in June.

    Wastewater upgrades

    Separately, the Construction Authority for Potable Water & Wastewater retendered the phase four expansion of the Abu Rawash wastewater treatment plant in Giza Governorate in January.

    The $157m scheme will be developed under a design, build, operate and maintain contract.

    The plant will have a treatment capacity of 400,000 cm/d, rising to peak flows of 520,000 cm/d. The authority issued the initial main contract tender last August. 

    It is unconfirmed whether this has moved beyond the bidding stage.

    Egypt currently produces between 1.5 million cm/d and 2 million cm/d of desalinated water. The country aims to increase capacity to between 8 million cm/d and 9 million cm/d by 2050.

    In March, Egypt’s cabinet approved a $1.2m grant agreement with the European Investment Bank to support wastewater treatment upgrades in Alexandria and Damietta.

    Part of the funding will support plans to expand the Hanovil wastewater treatment plant in Alexandria Governorate.

    The project will add 50,000 cm/d of treatment capacity in two phases within the plant’s existing footprint. Once completed, the facility will reach a total capacity of 100,000 cm/d.

    The grant will also support expansion works at the Kafr El-Battikh wastewater treatment plant in Damietta Governorate.

    The facility currently receives more than 7,000 cm/d of wastewater, while its treatment capacity is 3,000 cm/d.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16980726/main.jpg
    Mark Dowdall
  • Momentum builds for Syrian projects

    25 May 2026

     

    Support from the US, as well as the closure of the Strait of Hormuz, has increased expectations about the development of infrastructure projects in Syria.

    On 22 May, the US published guides to investing in Syria, funded by the US Department of State, that pointed investors towards 590 planned projects in the country.

    The permanent removal of US sanctions in December last year, combined with fallout from the closure and disruption to shipping through the Strait of Hormuz, has boosted interest in planned projects in the country.

    Shipping through the Strait of Hormuz has been disrupted since the US and Israel attacked Iran on 28 February.

    The route normally transports about 11 million barrels a day of oil and around 20% of the world’s liquefied natural gas, as well as a range of other key materials and consumer goods.

    The disruption to shipping through the strait has left nations in the Middle East scrambling to find new routes for imports and exports – and Syria plays a role in many of these new plans.

    This has bolstered the country’s plans to become a regional trade hub.

    Energy corridors

    Already, Iraq is moving a large volume of oil by truck across the country to export it from Syria’s Mediterranean ports, such as Latakia or Tartous.

    In April, Iraq’s state-owned oil marketing company, Somo, said it had awarded contracts to supply about 650,000 metric tonnes of fuel oil per month for overland trucking across Syria.

    On top of this, Iraq is currently looking into reestablishing a pipeline route that transported oil from Kirkuk to the port of Baniyas in Syria.

    The pipeline originally went into operation in April 1952.

    During the 2003 invasion of Iraq, the pipeline was damaged by US air strikes and has remained out of operation since then.

    There have been repeated attempts to either refurbish the existing pipeline or build a new one along the same route, but none has been successful.

    In December 2007, Syria and Iraq agreed to rehabilitate the pipeline. The pipeline was to be reconstructed by Stroytransgaz, a subsidiary of Russia’s Gazprom.

    However, Stroytransgaz failed to start the rehabilitation, and the contract was nullified in April 2009.

    The disruption to shipping through the Strait of Hormuz has added a new urgency to the project to reestablish pipeline flows from Iraq to Baniyas.

    Syria could also play a role in plans for a pipeline to transport gas from Qatar to Europe via Syria and Turkiye.

    The country could additionally form part of plans to rehabilitate and expand the Arab Gas Pipeline.

    The pipeline connects Egypt, Jordan, Syria and Lebanon, although the Lebanese section is not currently operational.

    Trade routes

    Beyond oil and gas, Syria is emerging as a key part of other plans for new trade routes.

    Earlier this month, Syria’s Transport Minister Yarub Badr said the country was seeking to restore its role as a regional transit corridor linking Europe and the Gulf by reviving cross-border trucking and rehabilitating railway connections with neighbouring countries.

    He said the overland corridor between the Turkish and Jordanian borders handled between 100,000 and 115,000 trucks annually in both directions before 2011. Freight rail services also operated between Tartous port and Iraq’s Umm Qasr port via Baghdad in 2009, he added.

    He said Syria was coordinating with Turkiye, Jordan and Saudi Arabia to simplify customs and border-crossing procedures and facilitate freight movement.

    Railway rehabilitation is expected to take longer due to extensive infrastructure damage and the suspension of cross-border rail links over the past decade.

    Badr said Syria is working with the World Bank to secure grants ranging between $65m and $200m to support railway rehabilitation and restore Syria’s role as a regional transit route linking Turkiye, Syria, Jordan and Iraq.

    Earlier this month, Syria’s state-owned railway company, the General Establishment for Syrian Railways, and the operator of Syria’s Latakia International Container Terminal signed a memorandum of understanding to coordinate container traffic between the Mediterranean port of Latakia and inland freight hubs.

    The framework covers feasibility studies for moving containers by rail from Latakia to dry ports in Adra, Hasiya and Aleppo.

    The feasibility studies are expected to take four months to complete.

    Tartous port

    Also this month, executives from the UAE’s DP World and Syria’s General Authority for Borders and Customs (GABC) met to discuss accelerating the development of Syria’s Port of Tartous.

    Essa Kazim, chairman of DP World, met with Qutaiba Ahmed Badawi, chairman of GABC, to discuss opportunities to enhance infrastructure and logistics efficiency, ensuring the Port of Tartous is well-equipped to handle the anticipated rise in trade and cargo volume.

    DP World’s plans to develop the Port of Tartous form part of a 30-year concession agreement signed in July 2025 with the Syrian government.

    Under the agreement, DP World committed to invest $800m to upgrade infrastructure, expand capacity, and introduce modern cargo-handling and advanced digital systems.

    DP World has said that, by fast-tracking the development of the Port of Tartous, it aims to boost its operational efficiency and capacity to handle diverse cargo types, including general cargo, containers, breakbulk and roll-on/roll-off traffic.

    Rizwan Soomar, DP World’s chief executive and managing director for Central Asia, the Levant and Egypt, said: “The Port of Tartous development marks a defining moment in Syria’s journey of economic recovery and modernisation of its trade infrastructure. We are proud to contribute to this vital phase of growth.”

    Located on Syria’s Mediterranean coast, the Port of Tartus is the country’s second-largest port and a key maritime gateway to trade routes across Europe, the Levant and North Africa.

    Beyond the port itself, DP World is exploring other opportunities to develop infrastructure in Syria with local stakeholders. These include logistics zones, inland freight hubs and transit corridors.

    US interest

    US-based companies are also showing significant interest in participating in new projects in the country.

    On 19 May, a delegation from the Houston-headquartered engineering company KBR travelled to Damascus to discuss road networks and infrastructure projects in Syria.

    During one meeting, Syria’s transport minister outlined strategic projects currently underway, including north-south and east-west corridor projects, the Damascus-Aleppo highway and railway initiatives.

    Badr said that companies were needed to update economic and technical studies for some projects.

    While Syria and the US both have bold ambitions to expand Syria into a regional trade and logistics hub, the poor state of the country’s infrastructure is likely to be a key challenge.

    It is likely that billions of dollars will need to be invested to rehabilitate the country so that its capacity to transport goods returns to levels seen prior to the civil war that began in March 2011.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16975219/main.jpg
    Wil Crisp
  • Alec confirms Sphere Abu Dhabi contract award

    25 May 2026

    Alec Holdings has confirmed that its subsidiary Alec Engineering & Contracting has received a letter of award for the construction contract for the $1.7bn Sphere Abu Dhabi project.

    MEED had previously reported that Alec was the selected contractor and had been working on the project during the pre-construction phase. The construction is due to be completed in the third quarter of the financial year 2029.

    Abu Dhabi’s Department of Culture & Tourism (DCT Abu Dhabi) and US-based Sphere Entertainment announced earlier in May that they have selected Yas Island as the location for the project.

    The venue will be built on a plot between Yas Mall and SeaWorld Abu Dhabi, close to Yas Island’s theme parks and attractions. The project will be the first Sphere venue outside the US. It is expected to echo the scale of Sphere Las Vegas, with a capacity of up to 20,000 depending on configuration.

    DCT and Sphere Entertainment finalised an agreement last year for the construction, development and operation of the Sphere entertainment venue in Abu Dhabi. According to the agreement, Sphere Entertainment granted DCT the exclusive rights to build and operate the Sphere Abu Dhabi entertainment venue.

    > Be recognised among the best in the industry at the MEED Projects Awards 2026 …

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16973522/main.jpg
    Colin Foreman
  • Consultant wins Jeddah metro design

    22 May 2026

     

    French engineering firm Egis has been appointed to undertake the preliminary design consultancy for the Jeddah Metro Blue Line project.

    The project client, Jeddah Development Authority, issued the tender in early January, when MEED exclusively reported that Saudi Arabia had restarted plans to build the Jeddah Metro.

    Engineering consulting firms submitted bids in April, as MEED reported.

    The Blue Line will run from King Abdulaziz International airport and connect to the Haramain high-speed railway station.

    The line will be 35 kilometres (km) long and will include 15 stations.

    Project history

    Plans for the Jeddah Metro were first publicly floated in the early 2010s and were formally packaged into a wider Jeddah public transport programme around 2013-14.

    In 2014, French engineering firm Systra was appointed to complete preliminary engineering for the Jeddah Metro, as MEED reported at the time.

    In the same year, US-based engineering firm Aecom was awarded a SR276m ($74m) contract to provide pre-programme management consultancy services.

    Under its 18-month contract, Aecom was expected to provide staff to support preliminary planning and design work for various phases of the metro project.

    This was followed by the appointment of UK-based architectural firm Foster + Partners in 2015 to design the metro stations.

    The project then stalled as government spending priorities were reset and major capital programmes were reviewed following the fall in oil prices in 2015, with the metro’s scope, cost and delivery model coming under reassessment.

    Early concept designs envisaged a multi-line network integrated with buses and, later, other city-wide mobility upgrades.

    Route details

    According to Jeddah Transport Company’s website, the scheme comprises 81 stations and 197 trains serving more than 161km. The network will have four lines:

    • Orange Line: a 44.8km line running along Al-Madinah Road and Old Makkah Road, with 29 stops including one at Obhur Bridge
    • Blue Line: a 35km line running from King Abdulaziz International airport to the Haramain high-speed railway station, with 15 stations
    • Green Line: a 17km line running through the city centre, from the downtown area to the Haramain railway station, with nine stops
    • Red Line: A 59.7km line running from King Abdullah Stadium north to Old Makkah Street through King Abdulaziz Road and King Abdullah Road, with 25 stops

    > Be recognised among the best in the industry at the MEED Projects Awards 2026 …

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16949416/main.jpg
    Yasir Iqbal
  • Expo Riyadh tenders Saudi Arabia pavilion

    22 May 2026

     

    Expo 2030 Riyadh Company (ERC), tasked with delivering the Expo 2030 Riyadh venue, has tendered a contract to build the Saudi Arabia pavilion at the site.

    The tender was issued on 19 May, with a bid submission deadline of 26 August.

    The pavilion is a major asset located within the KSA District on the eastern side of the Expo 2030 Riyadh masterplan, within the Loop of Nations district.

    The tendering of the pavilion structure follows swift progress on the site’s infrastructure development works.

    In April, ERC awarded two contracts for the next phase of infrastructure works at the site to local firm Al-Yamama Company.

    The scope covers the construction of road networks and infrastructure for water, sewage, electricity, telecommunications and electric vehicle charging.

    These awards followed ERC’s January award of an estimated SR1bn ($267m) contract for initial infrastructure works at the site to local firm Nesma & Partners. That scope covers about 50 kilometres of integrated infrastructure networks, including internal roads and essential utilities such as water, sewage, electrical and communication systems, and electric vehicle charging stations.

    The overall infrastructure works – covering the construction of main utilities and civil works at Expo 2030 Riyadh – are split into three packages:

    • Lot 1 covers the main utilities corridor
    • Lot 2 includes the northern cluster of the nature corridor
    • Lot 3 comprises the southern cluster of the nature corridor 

    The masterplan encompasses an area of 6 square kilometres, making it one of the largest sites designated for a World Expo event. Situated to the north of the Saudi capital, the site will be located near the future King Salman International airport, and will provide direct access to various landmarks within Riyadh.

    The Public Investment Fund (PIF), Saudi Arabia’s sovereign wealth fund, launched ERC – a wholly owned subsidiary – in June last year to build and operate facilities for Expo 2030.

    MEED’s April 2026 report on Saudi Arabia includes:

    > COMMENT: Risk accelerates Saudi spending shift
    > GVT &: ECONOMY: Riyadh navigates a changed landscape
    > BANKING: Testing times for Saudi banks
    > UPSTREAM: Offshore oil and gas projects to dominate Aramco capex in 2026
    > DOWNSTREAM: Saudi downstream projects market enters lean period
    > POWER: Wind power gathers pace in Saudi Arabia
    > WATER: Sharakat plan signals next phase of Saudi water expansion
    > CONSTRUCTION: Saudi construction enters a period of strategic readjustment
    > TRANSPORT: Rail expansion powers Saudi Arabia’s infrastructure push

    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16949696/main.jpg
    Yasir Iqbal