ADNOC Drilling's first-quarter profit jumps on strong oilfield services
ADNOC Drilling's net profit rose to $341 million in the quarter ended March, up from $275 million in the same period last year. Revenue rose nearly a third to $1.17 billion.
Oilfield services' revenue rose 134% to $342 million, mainly driven by increased activity in unconventional and integrated drilling services.
The company's board also approved quarterly dividend payments instead of semi-annually, with the first payment of $217 million for the first quarter of 2025 expected to be distributed on May 28. That amount will be a floor for subsequent quarterly payments in 2025.
"Despite recent volatility in global markets, the Company's previously announced full year 2025 and medium-term guidance remains unchanged and is further supported by recent contract awards," ADNOC Drilling said.
The company projects 2025 net profit between $1.35 and $1.45 billion and revenue of $4.6 billion to $4.8 billion. Recent contract awards include a $1.63 billion five-year integrated drilling services contract and an $806 million contract for three newbuild island rigs, both from ADNOC Offshore.
ADNOC Drilling's joint ventures, Enersol and Turnwell, are helping drive its growth. Turnwell, in which oil services firms SLB and Patterson-UTI have stakes, was created to tap unconventional energy resources - oil and gas that require advanced extraction methods.
Enersol, a joint venture with Abu Dhabi firm Alpha Dhabi, invests in artificial intelligence-powered drilling.
It is expected to spend around $700 million on at least two merger and acquisition deals this year, with the United States a particular focus, Chief Financial Officer Youssef Salem told Reuters. Around half of that will come from Alpha Dhabi, which is part of a business empire overseen by Abu Dhabi royal Sheikh Tahnoon bin Zayed al-Nahyan.
ADNOC Drilling's capital expenditure this year is expected at around $500 million, with another $500 million expected for mergers and acquisitions, of which $350 million would be for Enersol, Salem said.
The company has drilled more than 40 unconventional wells out of a 144-well programme. It expects to have drilled more than 80 by the end of the year, the CFO said. The firm also drills around 800 conventional wells a year.
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