Vallourec Bags 2-Year Contract Extension with ADNOC

Vallourec has secured a two-year extension of its supply contract with the Abu Dhabi National Oil Company (ADNOC).

The 2019 contract was originally worth approximately $900 million. The extension will take effect in January 2025 and will last up to January 2027, Vallourec said in a news release. The financial details of the extension were not disclosed.

Vallourec said it will continue to supply the complete range of tubes and connections for both conventional and complex applications in onshore and offshore oil and gas fields. The company said it will also provide support with its VAM Field Service on-site assistance offering.

In addition to the extension, the contract has been amended to expand the initial contract scope of supply to also include a new range of services, such as local pipe coating as well as Vallourec’s new digital solutions such as Tallyvision, which streamlines installation operations by providing full traceability for each tube, according to the release.

Under the extension, Vallourec also secured a new major order for the supply of 27,000 metric tons of tubes. The products will be manufactured in Vallourec plants in France, Brazil, China and Indonesia, taking advantage of the company’s strategic premium production hubs, with deliveries starting at the end of the year.

“The extension of our contract shows our customer’s trust and the added value they have received from this integrated tubes and services offering we have provided for the past four years as a reference supplier,” Vallourec Chairman and CEO Philippe Guillemot said. “Under this extension, we are further expanding our range of services. Our customer has also recognized the value and quality of this enhanced offering with its significant new order. I am proud of the high level of our operations in Abu Dhabi and the unfailing commitment of our teams to our long-standing partner”.

Earlier in the week, Vallourec announced that it finalized a deal to provide Equinor with tubes and connections for its Brazilian projects. Vallourec said in a separate news release the five-year contract also covers accessories and services.

The solutions will support the development of the Bacalhau and Raia fields operated in the pre-salt, as well as the Peregrino field in the post-salt, Vallourec said. The Bacalhau field is situated in the Santos Basin and is operated by Equinor (40 percent), in partnership with ExxonMobil (40 percent), Petrogal Brasil (20 percent), and PPSA (a government company). The Raia field is composed of three pre-salt discoveries: Pão de Açúcar, Gávea, and Seat. They contain natural gas and oil/condensate recoverable reserves of above one billion barrels of oil equivalent, according to Equinor. The field is operated by Equinor (35 percent), in partnership with Repsol Sinopec (35 percent) and Petrobras (30 percent).

The contract includes innovative digital solutions and Vallourec’s Tubular Management Services to enhance efficiencies in Equinor's operations and reduce total ownership costs, Vallourec said. Its production facilities in Barreiro and Jeceaba, along with its Vallourec Tubular Solutions integrated services center in Macae, will cater to Equinor’s requirements.

Vallourec provides leading tubular solutions for the energy sector and other applications, from oil and gas wells in extreme conditions to the latest generation of power plants.

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