ADNOC Drilling has received approval for two offshore drilling contracts in Kuwait worth up to $313.6 million, marking its first offshore rig operations outside the United Arab Emirates.The Abu Dhabi-listed company said Kuwait Petroleum Corporation's Higher Procurement Committee had approved separate awards for two high-specification jack-up rigs to serve Kuwait Oil Company. Their combined maximum value is 96.55 million Kuwaiti dinars, with operations scheduled to begin in the fourth quarter of 2027.
Both contracts carry a firm four-year term, including mobilisation, and an option for a further year. The announced maximum value excludes that extension, meaning any additional work under the option would fall outside the disclosed amount.
The awards have not yet completed every contractual step. ADNOC Drilling said they remain subject to applicable conditions and the completion of relevant formalities, distinguishing the procurement approval from the commencement of operations.
The company expects to deploy one jack-up rig from its existing fleet and obtain the second through a bareboat charter. Under such an arrangement, the charterer hires the vessel without the owner providing its operating crew, allowing ADNOC Drilling to assemble the required capacity without purchasing another rig.
ADNOC Drilling expects the contracts to deliver their first full-year financial contribution in 2028. The contribution anticipated during the final quarter of 2027 is already incorporated into preliminary guidance previously communicated to investors, the company said.
The award extends ADNOC Drilling's geographical reach into Kuwait's offshore sector, where the company will provide and operate rigs for the state-owned Kuwait Oil Company. It is a significant operational distinction for a business whose established offshore drilling activities have been concentrated in the UAE.
Abdulla Naji Ateya Al Messabi, chief executive of ADNOC Drilling, described the decision as an important step in the company's international expansion. He said the company looked forward to applying its offshore experience and commitment to safe and reliable operations in Kuwait.
The contracts were approved under Kuwait Oil Company's tender RFP-2151011, covering two separate units identified in the procurement documents as Rig 1 and Rig 2. The equipment will be mobile jack-up platforms designed to support drilling activities in offshore waters.
Jack-up rigs are commonly deployed in relatively shallow offshore environments. Their supporting legs are lowered to the seabed before the drilling platform is raised above the water, providing a stable operating position. The company has not disclosed the precise offshore locations where the two units will work or the wells they will drill.
The financial terms place a ceiling on the combined value of the firm contracts rather than guaranteeing that the entire sum will immediately appear as revenue. Earnings and cash receipts will depend on contract execution and the applicable commercial arrangements once work begins.
The company identified the awards as part of the regional expansion element of its Drill-to-Operate strategy, which seeks access to additional customers and markets alongside its existing drilling and energy services operations. Its plans also involve partnerships intended to broaden the services it can provide across the life of an oil or gas well.
The Kuwait decision gives the company an offshore operating assignment beyond its domestic market while leaving the start of field activity more than a year away. The mobilisation period is included within the four-year term, rather than being treated as an additional period outside the contract duration.
ADNOC Drilling is listed on the Abu Dhabi Securities Exchange under the symbol ADNOCDRILL. Its business includes drilling rigs and integrated energy services, with offshore work forming one component of its wider operations.
Kuwait Petroleum Corporation's Higher Procurement Committee is the approving authority for the awards, while Kuwait Oil Company is the customer receiving the drilling services. That distinction is reflected in the company's announcement, which identifies the committee's approval and the two contracts under the same tender.
The approval follows a procurement process in which the Kuwaiti authorities assessed the bids against the tender requirements. Kuwait’s official gazette identified ADNOC Drilling as the lowest-priced bidder meeting the stated technical specifications and conditions. The company’s announcement did not provide a breakdown of mobilisation costs or operating charges for either rig.
The procurement covers the provision and operation of both rigs. ADNOC Drilling has not announced individual contract values for Rig 1 and Rig 2, nor specified whether the optional fifth year would be exercised separately for each unit.
Topics
Spotlight