Adnoc’s global expansion through the creation of ventures will present opportunities for its subsidiary, Adnoc Drilling, which is looking for oil drilling tenders in Kuwait and Oman, a senior executive said.
Adnoc, responsible for most of the UAE’s oil production, is boosting its international presence and recently announced the launch of XRG, a lower-carbon energy and chemicals investment unit, with an enterprise value of more than $80 billion.
Last month, oil major BP and XRG announced the completion of a joint venture named Arcius Energy, which will initially focus on gas assets in Egypt.
“All of these ambitious international operations of Adnoc, by definition, [will] open for us a lot of doors,” Youssef Salem, the chief financial officer of Adnoc Drilling told The National.
Adnoc Drilling, which is looking to expand in the Middle East, is seeking contracts for drilling and oilfield services in Kuwait and Oman.
“The idea, over time, is to try to build a position similar to what we have in Abu Dhabi in terms of integration,” Mr Salem said.
The drilling business requires longer pre-qualification processes in each country, whereas service operations allow the company to be “more agile” and quickly respond to attractive tenders, he said.
Last year, Adnoc Drilling was earmarked for inclusion on Kuwait Oil Company’s list of approved contractors.
Kuwait, Opec’s fifth-largest producer, aims to increase its crude oil production to four million bpd by 2035 from about 2.4 million bpd.
National oil companies in the Middle East are set to increase oil and gas output in the coming years, betting on demand in developing economies.
Adnoc Drilling will “achieve or exceed” its profit guidance for 2024 when it reports results in mid-February, Mr Salem said.
In October, the company raised the lower limit for its annual net profit to between $1.2 billion and $1.3 billion, compared with the earlier range of $1.15 billion to $1.3 billion.
Adnoc Drilling's fourth-quarter revenue will reflect the initial earnings generated by its newly formed joint ventures, Turnwell and Enersol, Mr Salem said, adding that these ventures will position Adnoc Drilling for a strong 2025.
Last year, Adnoc Drilling, Schlumberger, and Patterson-UTI formed Turnwell, which will focus on the UAE's unconventional oil and gas programme.
Adnoc Drilling also teamed up with Alpha Dhabi Holding to launch Enersol, a tech-focused joint venture, in January last year. The company aims to invest $1.5 billion in technology-driven firms in the oilfield services sector by the end of 2025.
Enersol spent $750 million to $800 million on acquisitions last year and plans to follow a similar strategy this year, Mr Salem said.
“We have a very healthy pipeline. If you look at last year, [the acquisitions] were a majority in North America, and then kind of minority in Europe and the Middle East, so we're looking again at a very similar pipeline for this year,” he added.
Meanwhile, Turnwell is focused on the Abu Dhabi market due to the scale of projects and the opportunity to build a strong track record of successful operations, Mr Salem said.
Turnwell is currently drilling 144 unconventional oil and gas wells as part of a $1.7 billion contract awarded by Adnoc in May. The programme is “on track” to be completed between the end of 2025 and mid-2026, Mr Salem said.
By completing wells faster, the company can reduce costs, increase profit margins, and redeploy rigs to the next well more quickly, he added.
Adnoc Drilling has a contracted backlog of six rigs for this year and next, which will bring the company’s total to 148 rigs. It also plans to add two to three uncontracted rigs annually as part of its regular operations.
The specs
Engine: 0.8-litre four cylinder
Power: 70bhp
Torque: 66Nm
Transmission: four-speed manual
Price: $1,075 new in 1967, now valued at $40,000
On sale: Models from 1966 to 1970
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
Q&A with Dash Berlin
Welcome back. What was it like to return to RAK and to play for fans out here again?
It’s an amazing feeling to be back in the passionate UAE again. Seeing the fans having a great time that is what it’s all about.
You're currently touring the globe as part of your Legends of the Feels Tour. How important is it to you to include the Middle East in the schedule?
The tour is doing really well and is extensive and intensive at the same time travelling all over the globe. My Middle Eastern fans are very dear to me, it’s good to be back.
You mix tracks that people know and love, but you also have a visually impressive set too (graphics etc). Is that the secret recipe to Dash Berlin's live gigs?
People enjoying the combination of the music and visuals are the key factor in the success of the Legends Of The Feel tour 2018.
Have you had some time to explore Ras al Khaimah too? If so, what have you been up to?
Coming fresh out of Las Vegas where I continue my 7th annual year DJ residency at Marquee, I decided it was a perfect moment to catch some sun rays and enjoy the warm hospitality of Bab Al Bahr.
The specs: 2018 Opel Mokka X
Price, as tested: Dh84,000
Engine: 1.4L, four-cylinder turbo
Transmission: Six-speed auto
Power: 142hp at 4,900rpm
Torque: 200Nm at 1,850rpm
Fuel economy, combined: 6.5L / 100km
Which honey takes your fancy?
Al Ghaf Honey
The Al Ghaf tree is a local desert tree which bears the harsh summers with drought and high temperatures. From the rich flowers, bees that pollinate this tree can produce delicious red colour honey in June and July each year
Sidr Honey
The Sidr tree is an evergreen tree with long and strong forked branches. The blossom from this tree is called Yabyab, which provides rich food for bees to produce honey in October and November. This honey is the most expensive, but tastiest
Samar Honey
The Samar tree trunk, leaves and blossom contains Barm which is the secret of healing. You can enjoy the best types of honey from this tree every year in May and June. It is an historical witness to the life of the Emirati nation which represents the harsh desert and mountain environments
Labour dispute
The insured employee may still file an ILOE claim even if a labour dispute is ongoing post termination, but the insurer may suspend or reject payment, until the courts resolve the dispute, especially if the reason for termination is contested. The outcome of the labour court proceedings can directly affect eligibility.
- Abdullah Ishnaneh, Partner, BSA Law
MATCH INFO
Burnley 1 (Brady 89')
Manchester City 4 (Jesus 24', 50', Rodri 68', Mahrez 87')
In numbers: PKK’s money network in Europe
Germany: PKK collectors typically bring in $18 million in cash a year – amount has trebled since 2010
Revolutionary tax: Investigators say about $2 million a year raised from ‘tax collection’ around Marseille
Extortion: Gunman convicted in 2023 of demanding $10,000 from Kurdish businessman in Stockholm
Drug trade: PKK income claimed by Turkish anti-drugs force in 2024 to be as high as $500 million a year
Denmark: PKK one of two terrorist groups along with Iranian separatists ASMLA to raise “two-digit million amounts”
Contributions: Hundreds of euros expected from typical Kurdish families and thousands from business owners
TV channel: Kurdish Roj TV accounts frozen and went bankrupt after Denmark fined it more than $1 million over PKK links in 2013
Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
