ADNOC announces initiative to drive efficiencies in its tendering process

5/4/2021

The Abu Dhabi National Oil Company (ADNOC) announced it has successfully implemented an innovative initiative to drive efficiencies in its tendering process. This program supports ADNOC’s ongoing efforts to enhance its approach to procurement and maximize value for ADNOC and its community of suppliers and service providers. 

The program standardizes the terms and conditions for the procurement of drilling and oilfield goods and services across ADNOC’s entire value chain. As a result, ADNOC’s pre-qualified bidders are now subject to the same terms and conditions in competitive tendering, reducing the timeline for legal negotiations from months to weeks.

To deliver this initiative, ADNOC’s Legal Function, supported by its Upstream and Commercial & In-Country Value Directorates, developed global and oil and gas industry standard best practice terms and conditions for drilling and oilfield goods and services to support procurement of ADNOC’s entire value chain, sought feedback on commercial, risk and operational requirements from ADNOC’s pre-qualified community of goods and services providers and negotiated ADNOC’s standardized terms with the entire market.

“This initiative significantly speeds up ADNOC’s tendering process,” said Jasim M. Saeed, Senior Vice President, Group Procurement at ADNOC. “The approach underscores our efforts to drive commerciality across our business and proactively respond to the demands of a fast-evolving energy landscape. We are very pleased to have completed this initiative in a timely manner and we continue to work on identifying more win-win solutions for us and our contractors and suppliers to enhance value as we deliver our 2030 strategy.”

The program strengthens ADNOC’s relationships with its suppliers and contributes to more efficient operations, which ultimately maximizes the value from every barrel it produces. 

More than 1,100 international principal companies and United Arab Emirates (UAE) agent companies have signed up to the program. The initiative was negotiated by ADNOC’s Legal Function outside of the tender cycle and completed in only two months, ensuring there was no impact on ADNOC’s operations. Some of ADNOC’s largest providers of oilfield goods and services, including Baker Hughes, Halliburton, Schlumberger, and Weatherford, have signed up to the program.

“This initiative is yet another remarkable reminder that ADNOC continuously evolves and adapts its business vision and strategies to increase efficiency and boost productivity and also provide a win-win solution for its suppliers,” said Samir Al Gharbi, General Manager of Gulf Automation Services & Oilfield Supplies. “Standardizing the procurement terms and conditions across ADNOC’s value chain has drastically reduced the tendering cycle from months to just weeks. We believe that applying the same terms and conditions for all prequalified bidders is a very helpful and practical tendering methodology.”

ADNOC plans to expand the initiative to include process technology licensing agreements and construction agreements as it builds on the success of this first phase.

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