Strategic partnership to improve drilling efficiencies
The Abu Dhabi National Oil Company (ADNOC) and Baker Hughes, a GE company, (BHGE) signed a strategic partnership agreement that will enable and support the growth and development of ADNOC’s subsidiary, ADNOC Drilling, into a fully integrated drilling and well construction provider.
As part of the agreement, BHGE will acquire a 5% stake in ADNOC Drilling. The transaction values ADNOC Drilling at approximately US$11 billion. BHGE will be the sole provider of certain proprietary leading-edge and differentiated equipment and technologies related to the integrated drilling offering, supporting ADNOC Drilling’s growth.
The partnership represents the first time that ADNOC has brought an international strategic partner to acquire a direct equity stake in one of its existing services businesses. ADNOC Drilling is the largest drilling company in the Middle East and the sole provider of drilling rigs and associated services to ADNOC Group Companies.
The two partners will be able to leverage ADNOC Drilling’s existing rig fleet capacity with limited capital expenditure outlay. The partnership will gain significant new business opportunities, including the potential to offer integrated drilling services beyond the UAE’s borders.
“This unique partnership with BHGE comes at an important time in the drilling needs of Abu Dhabi as ADNOC grows its conventional and unconventional hydrocarbon resources and as we see future potential for further regional growth,” affirmed Dr. Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO.
“Supported by BHGE’s leading technology and service portfolio, ADNOC Drilling will enable ADNOC to unlock significant value from their untapped resources, while building local capabilities and accelerating overall market growth,” asserted Lorenzo Simonelli, Chairman and Chief Executive Officer, BHGE.
