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
  • EtihadWE to auction Al-Zawra power generation assets

    8 June 2026

     

    Register for MEED’s 14-day trial access 

    Etihad Water & Electricity (EtihadWE) is preparing to auction used power generation assets from its Al-Zawra facility in Ajman.

    The 200MW Al-Zawra gas-fired power plant was developed by the former Federal Electricity & Water Authority (Fewa), which was succeeded by EtihadWE.

    The sale includes gas turbines, generators and associated balance-of-plant equipment from the existing generation facility.

    The main equipment being offered comprises two GE Vernova / General Electric heavy-duty gas turbines. The units are PG 9171E / 9E machines designed for dual-fuel operation using natural gas and distillate. The package also includes two generators.

    EtihadWE said the assets will be sold on an “as is, where is” basis, with interested parties able to arrange site visits and inspections, subject to the relevant approvals.

    According to industry sources, the utility’s two power plants in Ajman and Ras Al-Khaimah have been out of service since 2021, and the Ajman plant was decommissioned in 2023. 

    Companies interested in taking part in the auction should contact:
    Mohamed.Shabeer@etihadwe.com
    khaled.reda@etihadwe.ae
    Horizon.PMO@etihadwe.ae
    https://image.digitalinsightresearch.in/uploads/NewsArticle/17143852/main.jpg
    Mark Dowdall
  • Kuwait plans to award $988m upstream contract within 30 days

    8 June 2026

     

    State-owned upstream operator Kuwait Oil Company (KOC) is planning to officially award a $988m project contract to India’s Larsen & Toubro within 30 days, according to industry sources.

    The contract is focused on developing Jurassic Light Oil (JLO) export facilities and upgrading the existing export network.

    Kuwait’s Central Agency for Public Tenders (Capt) has approved the award of the contract for the construction of export crude storage facilities and upgrades to the country’s oil export infrastructure.

    Now, talks are expected to take place between KOC and Larsen & Toubro to finalise the contract details.

    Just two companies submitted bids for the contract in October last year.

    The bidders were:

    • Larsen & Toubro (India): KD303.5m ($988m)
    • Petrofac (UK): KD310.6m ($1.01bn)

    Following bid submission, state-owned Kuwait Petroleum Corporation (KPC) discussed the potential cancellation of the contract tender due to the bids coming in significantly over budget and Petrofac becoming ineligible to win contracts in Kuwait.

    The financially troubled engineering company was temporarily banned from participation in tenders in Kuwait’s oil and gas sector in December last year.

    It was given the ban after the company announced that it had applied to appoint administrators, a move that potentially put thousands of jobs at risk and increased uncertainty for projects worth billions of dollars in the Middle East and North Africa (Mena) region.

    Despite holding talks about the potential cancellation of the tender, KPC ultimately decided to proceed with the contract award process because it considered the project a high priority.

    One source said: “Around the same time, projects worth around $8bn were cancelled because of bids coming in over budget, but this one has gone ahead because KPC sees it as an essential project.”

    The project was originally tendered in November 2024, with a bid deadline of 1 December the same year.

    The bid deadline was extended several times before bids were ultimately submitted.

    Kuwait’s oil and gas sector is in turmoil as a result of the ongoing regional conflict that started on 28 February when the US and Israel attacked Iran.

    Amid the ongoing conflict, Kuwait’s Ministry of Finance has stopped publishing its monthly report with details about revenues from oil exports.

    While there are no official figures available, many experts believe that the country failed to export crude oil during April and May.

    This is likely to have a severe impact on the country’s economy, which relies on oil exports for approximately 90% of government revenues.

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

    GCC looks beyond the Strait; Iraq’s reform window narrows as fiscal assumptions shatter; MEED Top 100 companies.

    Distributed to senior decision-makers in the region and around the world, the June 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/17143767/main.png
    Wil Crisp
  • Amea Power signs 1.5GWh battery storage EPC contracts

    8 June 2026

    UAE-based Amea Power has signed engineering, procurement and construction (EPC) contracts with China Energy Engineering Corporation (China Energy) for two standalone battery energy storage system (bess) projects in Egypt with a combined capacity of 1,500 megawatt-hours (MWh).

    The contracts cover the 500MWh Horus battery storage project in Zafarana and the 1,000MWh Nefertiti battery storage project in Benban.

    The agreements were signed on 4 June in the presence of Mahmoud Esmat, Egypt’s minister of electricity and renewable energy, Sheikh Hussein Al-Nowais, chairman of Al-Nowais Investments and Amea Power, and Ni Jin, chairman of China Energy.

    The projects are part of Egypt’s wider programme to expand energy storage capacity and support the integration of renewable energy into the national grid.

    According to the Ministry of Electricity & Renewable Energy, Egypt plans to increase battery storage capacity to 14,320MWh by 2028.

    The ministry said the expansion of battery storage is required to support the growing share of solar and wind power generation, improve grid stability and reduce reliance on fossil fuels.

    The signing ceremony also included an agreement between Amea Power, China Energy and Chinese battery manufacturer Gotion to establish a battery storage manufacturing facility in Egypt.

    The planned factory will have an annual production capacity of 3,000MWh.

    Amea Power previously signed capacity purchase agreements with the Egyptian government to develop the country’s first standalone bess projects in 2025.

    In March, the government announced it had signed power-purchase agreements for several renewable energy and battery storage projects with a combined capacity of 5.6GW.

    These include a 900MW wind power project in the Red Sea Governorate, along with a 2,000MW solar power plant and a 2,000MWh battery storage facility in the Qena Governorate. 

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

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17143364/main.jpg
    Mark Dowdall
  • Opec+ approves fourth consecutive oil output quota hike

    8 June 2026

    The Opec+ alliance of oil producers has agreed a fourth increase in its oil output targets in as many months, even though the conflict involving Iran, the US and Israel is still preventing several members from pumping more crude.

    The war has disrupted oil flows via the Strait of Hormuz, creating a severe supply crisis. Key Opec+ members, including Saudi Arabia, have been unable to supply customers in full since the end of February. The crisis for Opec+ deepened when the UAE left Opec after almost 60 years of membership.

    Seven core members of Opec+ – which comprises Opec countries and a group of non-Opec states led by Russia – raised their output quotas from April to June by almost 600,000 barrels a day (b/d).

    In practice, however, the group’s production has fallen sharply due to export cuts by Gulf members, averaging 33.19 million b/d in April compared with 42.77 million b/d in February, according to Opec figures.

    At the latest meeting of Opec+ oil ministers on 7 June, the seven members agreed to increase targets by 188,000 b/d from July, Opec said in a statement. This matches the June hike, which was adjusted down from monthly increases of 206,000 b/d in April and May to take account of the UAE’s exit.

    Iraq’s oil output quota will rise by 26,000 b/d from July under the agreement, an oil ministry spokesperson told Iraq’s state news agency.

     

    On 5 June, oil prices fell to about $93 a barrel as traders gained confidence that renewed conflict between the US and Iran was becoming less likely. Prices were close to $72 before the war began on 28 February.

    Brent crude rose sharply at the start of this week after Iran launched ballistic missiles at Israel on the night of 7 June, heightening fears that US-Iran peace talks might once again collapse. Israel has since retaliated with strikes in western and central Iran, despite calls from US President Donald Trump not to respond to the Iranian missiles.

    Brent crude jumped by around 4.5% early on 8 June and was trading at $97.52 a barrel as of 11am GST.

    The seven key Opec+ members are increasing production as part of the gradual unwinding of a 1.65 million b/d production cut agreed in 2023 by the coalition, which at the time included the UAE.

    From July, the seven have about 567,000 b/d of the original cut left to return to the market – taking into account the UAE’s exit from 1 May – according to Reuters calculations.

    That would imply the remainder of the cut will be unwound by the end of September if Opec+ maintains monthly hikes of about 188,000 b/d in August and September.

    The seven of the 21 Opec+ members who met on 7 June were Saudi Arabia, Iraq, Kuwait, Algeria, Kazakhstan, Russia and Oman. In recent years, only these seven – plus the UAE when it was a member– have been involved in the group’s output-policy decisions.

    In a separate meeting on Sunday attended by all Opec+ members, ministers made no change to the group-wide output policy in place until the end of 2026, Opec+ said in another statement.

    Opec+ is also reviewing members’ oil production capacity to use as a reference for 2027 production baselines, from which quotas are set. On Sunday, the group reaffirmed the importance of completing the assessment, the statement said.

    ALSO READ: UAE to continue working with Opec, energy minister says

     

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

    GCC looks beyond the Strait; Iraq’s reform window narrows as fiscal assumptions shatter; MEED Top 100 companies.

    Distributed to senior decision-makers in the region and around the world, the June 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/17143267/main.jpg
    Indrajit Sen
  • Deme wins dredging work for Tunisian ports

    8 June 2026

    The Office de la Marine Marchande et des Ports (OMMP) has awarded Belgium’s Deme a contract to carry out dredging and marine works at three ports in Tunisia.

    The project covers works at Sousse, Menzel Bourguiba/Bizerte and Rades/La Goulette. Deme will first construct containment dykes at the ports of Menzel Bourguiba and Sousse. The two ports are located more than 200 kilometres apart, which the contractor says will require careful planning, coordination and optimised logistics.

    The second phase involves extensive dredging works at all three locations, for which Deme will deploy a trailing suction hopper dredger.

    The project will use three distinct approaches to sustainably and efficiently manage dredged material, tailored to the characteristics of each location.

    In Sousse and Menzel Bourguiba, the material will be reused for land reclamation. In Bizerte, a combined approach will be adopted, with part of the material used for reclamation at Menzel Bourguiba and the remainder disposed of offshore. In Rades and La Goulette, all dredged material will be pumped ashore to a designated area.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17143268/main.jpg
    Colin Foreman