ADNOC forms strategic alliance with rig builder Helmerich & Payne
ABU DHABI - ADNOC and its subsidiary ADNOC Drilling Company, and Helmerich & Payne, a global leader in rig technologies and drilling solutions, jointly announced today a strategic alliance, that will see ADNOC Drilling acquire eight FlexRig land rigs from H&P for $86.5 million. Following this transaction, H&P will make a $100 million cornerstone investment into ADNOC Drilling’s recently announced initial public offering.
The strategic alliance and rig acquisition will support ADNOC’s target of reaching 5 million barrels per day (mbpd) production capacity and gas self-sufficiency for the UAE by 2030, along with plans to unlock its unconventional oil and gas resources. These agreements will further drive ADNOC Drilling’s growth and expansion as well as enhance its rig-based operational performance by providing access to the world-class H&P FlexRig® land rig fleet and leveraging H&P’s expertise and technologies. In addition, the alliance will support ADNOC Drilling in further driving operational excellence through maintenance efficiencies, supplementing supply-chain capabilities, and adding engineering and rig design competencies. The alliance will also deliver more competitive well completion times, greater drilling efficiencies and improved well economics.
For H&P, these agreements help facilitate its goal of allocating capital internationally, particularly in the MENA region, by accelerating its access into the attractive and fast-growing Abu Dhabi market as a key platform for further regional expansion. H&P’s cornerstone investment in the upcoming ADNOC Drilling IPO also highlights its confidence in the attractiveness and long-term value creation potential of ADNOC’s unique energy assets to leading international market participants.
His Excellency Dr. Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology and ADNOC Managing Director and Group CEO, said: “I am pleased to announce a strategic alliance with Helmerich & Payne, a globally renowned drilling solutions provider. This exciting alliance and value creation opportunity will provide ADNOC Drilling with access to new world-class rigs and services, enabling it to continue to support ADNOC in our ambitious production capacity expansion plans.
“H&P’s cornerstone investment in our planned ADNOC Drilling IPO further reinforces ADNOC’s continued success as a primary catalyst in attracting leading global investors and industry partners into Abu Dhabi and the UAE.”
On September 6, 2021, ADNOC announced its intention to float a 7.5 percent minority stake of ADNOC Drilling on the Abu Dhabi Securities Exchange (“ADX”) through an IPO, demonstrating the continued growth, strength and prominence of Abu Dhabi’s financial marketplace. Both ADNOC and H&P will remain committed, long-term shareholders in ADNOC Drilling.
John Lindsay, H&P’s President and CEO commented: “We are excited to enter into this strategic alliance with ADNOC Drilling and the value this alliance can create for both companies and stakeholders. Our investment in ADNOC Drilling is an additional step in the execution of our international growth strategy to allocate additional capital outside the U.S. and serves as a testament of our belief in what ADNOC Drilling and H&P can achieve together. We look forward to partnering with ADNOC and ADNOC Drilling to help create a similar value proposition that we have for customers in the U.S. and other international locations.”
H&P’s cornerstone investment will be at the IPO price and is subject to a three-year lock-up. As stated in the ADNOC Drilling Prospectus, like other shareholders, H&P expects to benefit from ADNOC Drilling’s commitment to a robust dividend policy. The rigs are expected to be delivered and commissioned in stages over a twelve-month period subject to acceptance upon successful completion of a final inspection on customary terms and conditions.
The strategic alliance and cornerstone investment announced today represents a natural evolution in ADNOC’s value creation plan and will provide ADNOC Drilling with a significant competitive advantage in the region, enabling it to further capitalize on its leading position as the largest national drilling company in the Middle East with 96 rigs, nearly twice the size of the next largest regional drilling provider.
Related News ///
Connect with World Oil
Join Our Newsletter ///
Sign-up for World Oil Daily News
Latest News ///More
- Hungary says ditching Russian oil to cost at least $810 million (5/17)
- Persian Gulf’s smallest oil producer looks to gas imports to meet demand (5/17)
- Shell joins Exxon with $1 billion Brazil exploration setback (5/16)
- James Fisher AIS expands global footprint to meet energy sector digital twin demand (5/16)
- APICORP appoints Khalid bin Ali Al-Ruwaigh as new CEO (5/16)