Petrofac wins $600m contract with UAE oil giant ADNOC
- ADNOC has awarded the London-based energy services business a $600m deal
- The Habshan CCUS project is approximately 93 miles southwest of Abu Dhabi
- Petrofac will supply carbon capture units, pipeline infrastructure and wells
Petrofac has won another bumper contract from the UAE’s state-owned oil giant to provide equipment for a major Middle Eastern carbon capture scheme.
Abu Dhabi National Oil Company (ADNOC) has awarded the London-based energy services business a $600million (£497million) deal to supply carbon capture units, pipeline infrastructure and several sequestration wells.
The technology is set to be delivered to the Habshan Carbon Capture, Utilisation and Storage (CCUS) project, which is about 93 miles southwest of Abu Dhabi.
Contract: Petrofac has won a $600million deal to supply carbon capture units, pipeline infrastructure and sequestration wells to a major Middle Eastern carbon capture scheme
It is the second major contract that Petrofac has won from the corporation in 2023, having been granted a £555million deal in late June for construction work on a new gas compressor plant.
Petrofac won another two contracts from the company last year for brownfield work and a two-year extension for field maintenance services at the Haliba oil field.
Its latest deal with ADNOC coincides with the ADIPEC conference in Abu Dhabi, a major exhibition for the global energy industry, and comes two months before Dubai hosts the COP28 climate summit.
One of the world’s largest oil producers, ADNOC’s investment in CCUS schemes forms part of a goal to achieve net zero emissions from its operations by 2045, five years earlier than its previous target.
The government-run business predicts the Habshan project will catch and store up to 1.5 million tonnes of CO2 underground per year once fully operational and triple its overall carbon capture capacity to 2.3 million tonnes annually.
Tareq Kawash, chief executive of Petrofac, said: ‘By accelerating plans to make energy cleaner, the UAE is investing in its future.
‘We look forward to combining our CCUS expertise and UAE project delivery experience to support ADNOC Gas in delivering on their decarbonisation plans, maximising energy output while minimising emissions, and helping to support the UAE’s energy transition.’
Petrofac shares were 0.7 per cent lower at 72.35p on early Tuesday afternoon. They remain significantly below their pre-Covid levels due partly to turnover falling for consecutive years.
Petrofac’s reputation has also been badly damaged by revelations that senior executives at the group paid bribes to secure multi-billion pound contracts across the UAE, Iraq and Saudi Arabia.
As a result of the scandal, the firm found it more challenging to obtain work across the Middle East and was briefly banned from applying for ADNOC contracts.
Although the company has started to accumulate a large backlog of work over the past year, it is still struggling to grow sales and turn a profit.
In the opening six months of 2023, it swung to a £165million net loss after its engineering and construction division was hit by write-downs on legacy contracts.