Dubai: Abu Dhabi National Oil Company (ADNOC) has signed framework agreements for concept and front-end engineering design (FEED) for major projects across its entire value chain. FEED relates to engineering services rendered after completion of a feasibility study.
The agreements – which were signed with eight top-tier global engineering contractors – have a combined scope worth up to $1 billion and potential for 50 per cent of the value to flow back into the UAE economy under ADNOC’s in-country value (ICV) programme between 2021 and 2026.
“These agreements follow a very competitive tender process and the smart nature of the deals will deliver substantial cost savings, optimize project delivery schedules and provide ADNOC with increased flexibility to drive its growth targets and proactively respond to the demands of the fast-evolving energy landscape,” said Abdulmunim Saif Al Kindy, ADNOC People, Technology & Corporate Support Executive Director.
ADNOC signed the agreements with AMEC International, Fluor, McDermott, Mott MacDonald, SNC-Lavalin International Arabia Limited – Abu Dhabi (part of the Kentech Group), Technip Energies, Worley, and a joint venture between Tecnicas Reunidas and NPCC. The deals will run for five years, with an option for a two-year extension.
By structuring the framework agreements with a group of top-tier contractors instead of procuring smaller individual agreements, ADNOC was able to secure pre-agreed terms and conditions thereby reducing tendering cycle by months. It was also able to achieve highly competitive rates by leveraging long-term contracts that service its entire portfolio and establish a group-wide performance management and review process that provides high visibility of contractor performance.