UAE-based state-owned oil giant Adnoc has announced that it will invest around $122 billion in the next five years to boost its oil and natural gas output. The budget was recently approved by Abu Dhabi’s Supreme Petroleum Council. The investment will aim to help Adnoc grow its refining and trading capacity.
Jaafar Altaie, managing director of Abu Dhabi-based consultant Manaar Group told the media, “This is Adnoc demonstrating that they aim to be self-sufficient. It’s a proactive step that foresees the potential for future supply shortages and that sees a need for low-cost production in the coming years.”
The announcement comes at a time when the Organisation of Petroleum Exporting Countries (OPEC) and other oil-producing nations such as Russia have sought to cut output among its members after the coronavirus pandemic caused a significant drop in demand for crude.
Earlier this year, Adnoc awarded contracts worth $245 million to upgrade two main oil lines and terminal crude receiving facilities in Abu Dhabi. The contracts were awarded to China Petroleum Pipeline Engineering Company Limited – Abu Dhabi and Abu Dhabi-based Target Engineering Construction.
The Engineering, Procurement, and Construction (EPC) contract awarded to China Petroleum Pipeline Engineering Company is valued at approximately $135 million, and once developed it will increase the capacity of the pipelines by over 30 percent. The contract is for a period of 30 months and will see over 45 percent of the award value flow back into the UAE’s economy under Adnoc’s ICV programme.