Prime Highlights
- ADNOC Drilling plans to partner with Egypt’s state-backed oil firms to expand operations.
- Egypt aims to boost domestic drilling activity as part of its five-year energy strategy.
Key Facts
- XRG, ADNOC’s investment arm, holds a 78.5 percent stake in ADNOC Drilling.
- Egypt recently cleared outstanding arrears to global oil and gas companies to attract investment.
Background
ADNOC Drilling is seeking to expand its presence in Egypt by finalising partnerships with state-backed oil companies, as the country looks to attract greater investment in domestic oil and gas production. The Abu Dhabi-listed firm plans to collaborate with the Egyptian General Petroleum Corporation and its subsidiaries.
The plans were discussed in Cairo between ADNOC Drilling CEO Abdullah Al Messabi and Egypt’s Minister of Petroleum and Mineral Resources Karim Badawi. Al Messabi pointed to the company’s ongoing partnership with Egyptian Drilling Company, which offers drilling services across Egypt and international markets.
Badawi noted that boosting drilling activity forms a key part of Egypt’s five-year strategy to raise domestic crude oil and natural gas output.
The talks follow broader energy cooperation between the UAE and Egypt. In July, Badawi met ADNOC Group CEO Sultan Al Jaber in Abu Dhabi to explore ways to increase Emirati investment across Egypt’s energy sector, including undeveloped gas resources.
ADNOC’s international investment arm, XRG, already operates in Egypt through Arcius Energy, its joint venture with bp. Arcius Energy is advancing plans for the Harmattan gas field and drilling at the Atoll West exploration well in the Mediterranean.
Egypt has also taken steps to improve conditions for foreign energy investors, clearing its outstanding arrears to global oil and gas firms last month, a move expected to support renewed upstream investment.
The potential expansion comes as ADNOC continues raising investment at home and abroad. The group said in May it planned to award $55 billion in contracts over the next two years to support upstream and downstream growth.
ADNOC Drilling shares have gained more than 15 percent so far this year. XRG holds a 78.5 percent stake in the company.
