meed-logo

line1 line2 line3
SIGN IN / REGISTER

Offshore spending to remain robust in 2024

27 February 2024

 

This report also includes: Aramco continues its hunt for hydrocarbons

Spending on offshore oil and gas projects in the Middle East and North Africa (Mena) region reached a 10-year high in 2023. Regional hydrocarbons producers collectively awarded $17.5bn-worth of contracts, also making last year one of the best on record for capital expenditure (capex) on offshore oil and gas projects.

The robust spending was facilitated by a steady oil price environment, with Brent crude averaging about $82 a barrel, and by Mena state enterprises’ pursuit of strategic oil and gas production potential goals set by their respective governments.

The UAE’s Abu Dhabi National Oil Company (Adnoc) emerged as the biggest spender on offshore projects in the region last year. It awarded an estimated $17bn-worth of contracts for engineering, procurement and construction (EPC) works on its Hail and Ghasha sour gas development project.

The $8.2bn contract that Adnoc awarded to a consortium of Abu Dhabi’s NMDC Energy and Italian contractor Saipem for offshore EPC works on the Hail and Ghasha project is the single-largest offshore contract to have ever been awarded in the UAE. The package includes EPC work on offshore facilities including those on artificial islands, as well as subsea pipelines.

Aramco offshore capex

Saudi Aramco was the second-highest regional offshore spender. In 2023, the company awarded $5.5bn-worth of offshore engineering, procurement, construction and installation (EPCI) contracts to entities in its Long-Term Agreement (LTA) pool of offshore contractors.

A consortium of Indian contractor Larsen & Toubro Energy Hydrocarbon (LTEH) and UK-based Subsea7 won seven offshore EPCI contracts from Aramco estimated to be worth nearly $2bn.

LTEH/Subsea7 won tender numbers 98, 120 and 121 in Aramco’s Contracts Release & Purchase Order (CRPO) system, which cover EPCI work on Saudi Arabia’s Zuluf, Hasbah and Manifa offshore oil and gas fields. The combined value of the three CRPOs, which were awarded in March 2023, is estimated to be $1bn.

In April, LTEH/Subsea7 won CRPOs 117, 118 and 119, which cover EPCI work on Saudi Arabia’s Marjan offshore oil and gas field development. The three tenders are estimated to be worth over $900m.

The LTEH/Subsea7 consortium is also understood to have secured the contract for CRPO 97, which relates to EPCI work on several units at the Abu Safah field.

Italian contractor Saipem confirmed in early April that it had won CRPO 96, estimated to have a value of $120m. The scope of work on the tender covers the EPCI of one platform topside and the associated subsea flexible, umbilical and cable systems at the Abu Safah and Safaniya fields.

Also in April, China Offshore Oil Engineering Company won CRPO 122, estimated to be worth $255m, covering the installation of 13 jackets at the Safaniya field.

Saipem also won CRPO 124, a contract that is part of the third gas development phase of the Marjan hydrocarbons field.

Lamprell announced that it had also won a pair of offshore contracts – CRPOs 125 and 126 – with a combined estimated value of more than $400m.

Meanwhile, NMDC Energy confirmed it had been awarded CRPOs 136 and 137 by Aramco, which are worth a total of $1.3bn, and Lamprell won CRPO 135 at an estimated $390m. These three tenders cover the EPCI work on several structures at the Zuluf offshore oil and gas field development.

In December, Lamprell won CRPO 141, an estimated $20m-$25m contract for EPCI work on one jacket at the Zuluf field.

More spending ahead

Mena oil and gas producers are expected to maintain a high level of spending on offshore projects in 2024, with Aramco likely to lead the pack.

Most of Saudi Arabia’s oil and gas production comes from its offshore fields, such as Abu Safah, Arabiyah, Berri, Hasbah, Karan, Manifa, Marjan, Ribyan, Safaniya and Zuluf. 

Aramco aims to maintain and gradually increase production from these fields, some of which are mature. In order to do this, the company must continue to invest in upgrading and modifying existing infrastructure at these fields and installing new structures.

Aramco is evaluating bids that it received in September for 10 offshore tenders – CRPOs 104 to 113 – which entail EPCI work on several structures at the Safaniya field, which is believed to be the world’s largest oil field. These contracts are estimated to be worth billions of dollars.

Moreover, Aramco has also received bids for two large CRPO tenders – numbers 134 and 127 – that are estimated to be worth a combined $3.8bn.

LTA contractors are also due to submit bids for a dozen new tenders in February. Aramco is expected to award contracts for most of these CRPOs in Q1, kicking off another year of significant spending on offshore oil and gas projects.

Separately, in the 5,770 square-kilometre Saudi-Kuwait Neutral Zone, the joint venture of Saudi Aramco and Kuwait Petroleum Corporation (KPC) is making progress with its plans to develop gas from the disputed Dorra offshore field. 

Aramco and KPC selected France’s Technip Energies to carry out pre-front-end engineering and design (pre-feed) and feed work on the project to develop the field.

The two sides expect to produce about 1 billion cubic feet a day of gas from the Dorra field and have agreed to split the output equally. If Saudi Arabia and Kuwait are able to resolve their differences with Iran over the development of the asset, Aramco and KPC could award an estimated $5bn-worth of EPC contracts for the Dorra gas field development by the end of this year.

Further regional spending

Adnoc is also in line to award EPC contracts for several major offshore schemes this year, including its project to boost output from Abu Dhabi’s Upper Zakum offshore field. The project aims to raise the production potential of Abu Dhabi’s largest offshore field – the world’s second-largest – to 1.2 million barrels a day (b/d). 

Adnoc is also expected to award EPC contracts for two projects to increase the crude output capacity of its Lower Zakum field.

In Qatar, state enterprise QatarEnergy is due to award contracts this year for the remaining packages of the second phase of its North Field Production Sustainability (NFPS) project. 

The tender for the third NFPS phase two package was released by QatarEnergy LNG last year. The work on that package – known as EPCI 3 – is estimated to be valued at about $500m and covers EPCI work on offshore riser platforms, wellhead platforms and intra-field pipelines. 

QatarEnergy LNG also issued the tender to contractors last year for the EPCI 4 package, estimated to be worth up to $4bn. The scope of work on this package covers two gas compression complexes that will weigh 25,000-35,000 tonnes, contributing to a total of 100,000 tonnes of fabrication.

Aramco continues its hunt for hydrocarbons

 

https://image.digitalinsightresearch.in/uploads/NewsArticle/11551206/main.gif
Indrajit Sen

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

Click here to register
Exclusive from Meed
Related Articles
  • Construction advances on Riyadh King Salman airport

    19 May 2026

    King Salman International Airport (KSIA) is advancing airside infrastructure works under its long-term expansion programme in Riyadh, including the delivery of a third runway and new private aviation facilities.

    Construction activity on the central runway programme is progressing across several operational zones, with works covering excavation, grading, site preparation and taxiway-enabling infrastructure to support upcoming phases.

    The third runway is intended to increase airfield capacity and cater to the airport’s future operational requirements.

    In a separate development, KSIA has completed initial landside works for the private aviation apron, marking a milestone in the rollout of its executive aviation infrastructure.

    The completed scope includes pavement markings, waterproofing systems, firefighting infrastructure chambers and final operational inspections to support readiness for the next stages.

    KSIA has also secured General Authority of Civil Aviation (GACA) approval for phase one airside works, which includes the planned connection of Taxiway Alpha to the private aviation facilities, strengthening operational integration between executive aviation assets and airfield movement areas.

    The packages form part of the wider KSIA masterplan, which covers about 57 square kilometres and supports Saudi Arabia’s objective of positioning Riyadh as a global aviation and logistics hub.

    The airport aims to accommodate up to 100 million passengers by 2030.

    Saudi Arabia plans to invest $100bn in its aviation sector. The Saudi Aviation Strategy, announced by GACA, aims to triple annual passenger traffic to 330 million travellers by 2030. It also targets air cargo growth to 4.5 million tonnes and an increase in total air connections to more than 250 destinations.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16906496/main.jpeg
    Yasir Iqbal
  • Aldar launches Al-Ghadeer Gardens project

    19 May 2026

    Abu Dhabi-based real estate developer Aldar Properties has launched the Al-Ghadeer Gardens project, located on the Abu Dhabi-Dubai border.

    The new residential development will feature 437 villas and townhouses, offering two-, three- and four-bedroom homes.

    Al-Ghadeer Gardens will include more than 30,000 square metres of landscaped open space, supporting a pedestrian-friendly layout and outdoor-focused living.

    As part of its sustainability and wellbeing approach, the project is targeting Estidama Pearl 2 and Fitwel 2-star certifications.

    Earlier this month, Aldar announced its Q1 financial results, reporting a 20% year-on-year increase in net profit after tax to AED2.3bn ($626m).

    Aldar Development recorded a 14% year-on-year rise in revenue to $1.7bn, while earnings before interest, taxes, depreciation and amortisation (Ebitda) increased 23% to $599m.

    UAE revenue backlog rose to $17bn at the end of March from $16.6bn at the end of December, with an average duration of 29 months.

    The group attributed its performance to revenue from its development backlog and steady income from its investment properties.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16906154/main.jpg
    Yasir Iqbal
  • Iraq trucks oil from the south to Kurdish pipeline

    19 May 2026

     

    Iraq is trucking crude from Basra to the north of the country to be exported via the Iraq-Turkiye Pipeline (ITP), according to industry sources.

    The oil is being loaded into trucks at fields in Basra before being driven to the north, where it is injected into the pipeline network at Khurmala Dome, in the northern section of the Kirkuk field.

    Once it has entered the network at Khurmala Dome, it is transported to the main ITP export pipeline and eventually to the port of Ceyhan in Turkiye, where it can be loaded onto ships.

    The volumes of crude being transported using trucks have surged in Iraq since the US and Israel attacked Iran on 28 February, starting a regional conflict that has disrupted shipping through the Strait of Hormuz.

    One source said: “Most of the crude that is being trucked out of Iraqi oil fields at the moment is going to Syria, but some is being trucked to the north where it is being funnelled through the pipeline.”

    Even with the additional volumes being trucked from the south, Iraq is struggling to boost exports using the ITP.

    At the end of March, Amer Khalil, the director-general of Iraq’s state-run North Oil Company, said that Iraq was exporting 200,000 barrels a day (b/d) through the ITP.

    At the time, he said that the pipeline, which runs from Kirkuk in Iraqi Kurdistan to the port of Ceyhan in Turkiye, was expected to start transporting 300,000 b/d “in the near future”.

    As of early May, the pipeline was still exporting about 200,000 b/d, despite having a nameplate capacity of 1.4 million b/d.

    One of the factors said to be stopping increased volumes from being shipped through the pipeline is that several key oil fields in northern Iraq evacuated staff and stopped production after the US and Israel started their war with Iran.

    Another factor is that Iraq has not invested in domestic pipeline infrastructure to pipe production from Basra to Kurdistan, where it could be exported via the Kurdish ITP route.

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

    Global energy sector forced to recalibrate; Conflict hits debt issuance and listings activity; UAE’s non-oil sector faces unclear recovery period amid disruption.

    Distributed to senior decision-makers in the region and around the world, the May 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16902345/main1824.jpg
    Wil Crisp
  • Kuwaiti oil services company secures credit facility

    19 May 2026

    The Kuwaiti drilling and oilfield services provider Action Energy Company (AEC) has secured a new credit facility and renewed and expanded an existing facility in order to support the company’s rig fleet expansion.

    The new facility and the expansion were obtained from two Kuwaiti banks and had a combined value of KD40.9m ($132.8m).

    In its statement, AEC said that the facilities support the financing and deployment of new rigs linked to contract awards previously announced with the state-owned upstream operator Kuwait Oil Company (KOC).

    The company added: “They further reinforce AEC’s financing structure and strengthen its ability to execute its contracted fleet expansion plan through 2026 and beyond, while maintaining a disciplined approach to capital allocation.”

    The new credit facility was obtained from Kuwait International Bank (KIB).

    It is worth KD7.3m ($23.7m) and will finance two new 750-horsepower (HP) rigs.

    The renewal and expansion of the existing facility is worth KD33.6m ($109.1m) and was obtained from Commercial Bank of Kuwait (CBK) to finance four new 1,500 HP rigs and one 1,000 HP rig, in addition to the renewal of the existing facilities.

    AEC announced its financial and operational performance for the first quarter earlier this month.

    The company reported a net profit of KD2.2m ($7.1m).

    The company’s revenue grew by 69.2% year-on-year, primarily driven by the expansion of the operating rig fleet from 13 rigs in the first quarter of 2025 to 20 rigs in the first quarter of 2026, including the full-quarter contribution of 10 new rigs deployed during 2025.

    The company is benefitting from a substantial multi-year contracted backlog with KOC.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16902234/main.jpg
    Wil Crisp
  • Emirates awards $5bn engineering complex deal

    18 May 2026

    Register for MEED’s 14-day trial access 

    Emirates Airline has awarded a AED19bn ($5bn) contract to build one of the world's largest engineering complexes in Dubai South.

    The contract was awarded to Beijing-headquartered China Railway Construction Corporation (CRCC).

    CRCC is being supported by French firm Artelia, as the project consultant.

    The complex will cover over 1 million square metres (sq m).

    It will comprise 77,000 sq m of dedicated workshop space for maintenance and repairs, 380,000 sq m of storage and logistics capacity, a 50,000 sq m administrative building for Emirates Engineering and 15,000 sq m of training facilities.

    It will be the world's only complex with a capacity to service 28 wide-body aircraft simultaneously.

    The airline officially broke ground on the project on 18 May. 

    The groundbreaking ceremony was attended by Sheikh Ahmed Bin Saeed Al-Maktoum, chairman and CEO of Emirates Group; Tim Clark, president of Emirates Airline; Khalifa Al-Zaffin, executive chairman of Dubai Aviation City Corporation and Dubai South; and Dai Hegen, chairman of CRCC.

    The facility will enable large-scale retrofits, cabin redesigns and structural modifications to be performed in-house, thereby reducing turnaround times.

    The engineering complex is scheduled for completion in 2030 and will be located at Al-Maktoum International airport.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16895218/main.jpg
    Yasir Iqbal