ADNOC Drilling Company has been awarded the contract by ADNOC Offshore for three island drilling rigs at the offshore Zakum field. The estimated total contract value will be $733 million.
The rigs, which will be designed and built as part of a partnership between ADNOC Drilling and Honghua Group, will incorporate industry-leading technology and automation. Delivery of the rigs and commencement of operations is expected during 2026.
The Hong Kong-based Honghua Group is one of the leading land drilling equipment manufacturers in the world and the largest land drilling rig exporter in China.
The partnership aims to harness the transformative nature of artificial intelligence (AI), digitisation, and advanced technology in the design and operation of these next-generation drilling rigs. ADNOC Drilling and Honghua will also collaborate with AIQ, the Abu Dhabi-based AI pioneer contributing to the energy sector globally.
The design of the rig operating systems will look to utilise real-time condition, performance and utilisation data to create actionable insights, enhancing rig performance and increasing efficiency.
Drilling operations on ADNOC’s innovative artificial islands create the ideal conditions for extended reach drilling (ERD), with the top five longest wells in the world being delivered from these islands off the coast of Abu Dhabi. The most recently delivered well is over 52,000 feet.
The rigs will be built to deliver ERD as well as having the capability of ‘walking’ between wells, which eliminates the need for them to be dismantled to be moved. These capabilities improve efficiency and safety significantly while reducing costs and emissions.
Abdulrahman Abdulla Al Seiari, Chief Executive Officer of ADNOC Drilling, commented: “ADNOC Drilling is honoured to receive this award, which marks a significant milestone in our company’s accelerated growth journey. These new island rigs will be the most advanced in the world, embracing artificial intelligence.
“Our partnership with Honghua Group will amplify the creativity and ingenuity of our industry as we design and build these rigs of the future that drive efficiency and safety and deliver exceptional value for our customer ADNOC Offshore.”
Expanding ADNOC Drilling’s rig fleet
The three new rigs as well as the previously announced three land rigs for the initial phase of the development, bring ADNOC Drilling’s expected fleet to total at least 148 by 2026.
Tayba Abdul Rahim Al Hashemi, Chief Executive Officer of ADNOC Offshore, added: “ADNOC Drilling’s technical expertise and enhanced capabilities are key enablers as we safely and sustainably accelerate to meet the world’s growing energy demands. This award will strengthen our partnership in the future as we work together to harness AI and innovation to maximise energy, minimise emissions and unlock significant value for stakeholders.”
The contract award will follow existing agreements with revenue underpinned by a long-term duration with guaranteed returns.
The total capital expenditure expected for the purchase of the new island rigs is approximately $210 million, mostly concentrated in 2025, with the first full-year revenue from the new rigs expected to be 2027. The full-year 2024 guidance of $200-250 million for the Island rig segment, which currently operates ten island rigs, is unchanged.
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