Offshore Technology

ADNOC Offshore awards $500m EPC contract for Upper Zakum production expansion

The contract includes the engineering, procurement and construction (EPC) of several structures on Assefiya Island.

Abu Dhabi National Oil Company (ADNOC) Offshore has awarded the main contract for the second phase of an EPC project at the Upper Zakum offshore field to Abu Dhabi-based Target Engineering Construction Company, reported MEED.

The project is aimed at increasing the oil production capacity of the field to 1.2 million barrels per day (mbbl/d).

The Upper Zakum offshore field, located 84km offshore in Abu Dhabi, is reputed to be the world’s second-largest offshore oilfield. Its development comprises four main artificial islands: Al-Ghallan, Umm Al-Anbar, Ettouk and Asseifiya, also referred to as Central Island, West Island, North Island and South Island, respectively.

The project, called UZ 1.2MMBD EPC-2, is valued at approximately $500m (Dh2.34bn) and includes EPC works on several structures on Assefiya Island.

These structures encompass an integrated gas lift compressor and its associated facilities, a gas dehydration unit, a vapour recovery system and a seawater filtration package, among others.

ADNOC Offshore has undertaken the front-end engineering and design (FEED) work in-house for this project, as indicated in the expression of interest document. The main EPC tender for the project was issued in June.

Target Engineering received the main EPC contract for the first phase of the project, UZ 1.2MMBD EPC-1, at an estimated value of $825m in April this year.

Spanish contractor Tecnicas Reunidas carried out the FEED works for this phase in 2019, while UK-headquartered Wood Group was appointed as the project management consultant for the EPC phase.

ADNOC, in partnership with Japan Oil Development Company and ExxonMobil, has allocated a capital expenditure budget of approximately $30bn for the Upper Zakum hydrocarbons concession.

ADNOC Group subsidiary ADNOC Drilling set a world record for drilling the longest oil and gas well at the Upper Zakum concession, measuring 50,000ft, in October 2022.

In July this year, ADNOC Drilling secured a $733m contract from ADNOC Offshore to supply three newbuild island rigs to support the expansion of operations at the field.