ADNOC Announces $744MM Contract Award

ADNOC Announces $744MM Contract Award
ADNOC announced on Tuesday the award of a $744 million contract for the full field development of the Belbazem Offshore Block.

The Abu Dhabi National Oil Company (ADNOC) announced on Tuesday the award of a $744 million (AED2.73 billion) contract for the full field development of the Belbazem Offshore Block.

Al Yasat Petroleum Operations Company Ltd (Al Yasat) - ADNOC’s subsidiary and joint venture with China National Petroleum Corporation (CNPC) - awarded the engineering, procurement, and construction (EPC) contract to the National Petroleum Construction Company (NPCC). The scope of the award covers engineering, procurement, construction, and commissioning activities for the offshore facilities required to enable full production capacity of 45,000 barrels per day of light crude and 27 million standard cubic feet per day of associated gas from Belbazem, ADNOC outlined. First oil from the asset is expected in 2023.

As part of the lead up to the EPC award, which followed a competitive tender process, Al Yasat undertook a front-end engineering design (FEED) competition among the bidders to optimize the project. This reduced the originally scheduled tender time by up to 12 months, ADNOC revealed.

“We are very pleased to commence the full field development of the Belbazem Offshore Block, together with our strategic partner CNPC,” Yaser Saeed Almazrouei, ADNOC’s upstream executive director, said in a company statement.

“This award demonstrates our commitment to maximize value from all of Abu Dhabi’s hydrocarbon resources for the benefit of the UAE and our partners. NPCC was selected after a rigorous tender process that ensures it will deploy best-in-class technology and expertise to execute this strategic project, with a substantial part of the award value flowing back into the UAE’s economy to stimulate local economic growth, in line with the wise directives of our leadership,” he added.

Shaheen Al Mansoori, the acting chief executive officer of Al Yasat, said, “the FEED competition and EPC award for the Belbazem Offshore Block highlight Al Yasat’s focus on costs and competitive approach to ensure we can commercially develop our concession areas and deliver long-term and sustainable value for ADNOC and our partner CNPC”.

“Al Yasat will continue to drive cost efficiencies as we unlock value from those of Abu Dhabi’s fields which are comparatively smaller and require a lean operating model to optimize their production and value potential,” the Al Yasat representative went on to say.

The Belbazem Block, which is located 74 miles northwest of Abu Dhabi city, consists of three marginal offshore fields; Belbazem, Umm Al Salsal, and Umm Al Dholou. ADNOC and CNPC hold 60 percent and 40 percent stakes in Al Yasat, respectively.

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