ADNOC sharpens its energy expansion

Abu Dhabi National Oil Company will award Dh200 billion worth of project contracts between 2026 and 2028, marking one of the largest new execution phases in the Gulf energy sector as Abu Dhabi moves to expand capacity, secure supply chains and deepen local manufacturing.

The planned awards, equivalent to about $55 billion, form the first major tranche of ADNOC’s $150 billion capital expenditure programme for 2026-2030, approved by its board in November. The contracts will span upstream and downstream operations, covering a wide range of energy infrastructure, industrial manufacturing, engineering, procurement and construction work.

ADNOC’s announcement places local industry at the centre of its next investment cycle. The company said the new contracts would support the “Make it in the Emirates” industrial programme and strengthen its In-Country Value framework, which has become a central mechanism for channelling energy spending into factories, services and skilled employment within the UAE.

The plan was outlined at the Make it With ADNOC Forum in Abu Dhabi, where the company brought together major engineering, procurement and construction contractors and 70 manufacturers that meet its technical and qualification standards. The gathering was designed to give suppliers clearer visibility on ADNOC’s project pipeline and encourage early partnerships before tenders are awarded.

Dr Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology and ADNOC’s managing director and group chief executive, said the company was entering “a defining execution phase” driven by scale, pace and delivery. He said the next stage of ADNOC’s strategy would focus on meeting rising global energy demand while expanding the country’s industrial and manufacturing base.

The investment push comes as Gulf producers seek to balance three pressures: resilient demand for oil and gas, intensifying competition in liquefied natural gas, and growing scrutiny over emissions. ADNOC has positioned its spending plan around gas expansion, lower-carbon operations, downstream growth and international investments, while retaining oil production as a core revenue engine.

ADNOC’s five-year capital plan follows an increase in the company’s reserves to 120 billion stock tank barrels of oil and 297 trillion standard cubic feet of natural gas. The reserve additions reinforce Abu Dhabi’s strategy of maintaining long-term hydrocarbon relevance while channelling a larger share of procurement into domestic industry.

Gas remains a major pillar of the strategy. ADNOC has been expanding its liquefied natural gas portfolio through the Ruwais LNG project, long-term supply agreements and investments intended to raise export capacity. Ruwais is expected to more than double the company’s LNG production capacity once fully operational, strengthening its position in a market shaped by Asian demand, European supply diversification and the growing electricity needs of data centres.

The company’s overseas investment arm, XRG, has also become more prominent in ADNOC’s global expansion. The unit is reviewing multiple gas opportunities abroad, including assets across extraction, pipelines, processing, liquefaction and regasification. That approach indicates a shift from conventional upstream investment towards integrated gas value chains that can capture margins across production, transport and delivery.

ADNOC’s domestic spending has a broader economic purpose. Its In-Country Value programme has already returned tens of billions of dollars to the UAE economy since 2018, while supporting private-sector employment and local manufacturing. The next wave of contracts is expected to expand demand for industrial equipment, engineering services, chemicals, components, digital systems and specialised logistics.

The 2026-2028 awards also give contractors and suppliers a clearer three-year window at a time when large energy projects face cost inflation, skilled labour shortages and supply-chain bottlenecks. Early supplier engagement can reduce delivery risk, but it also places pressure on manufacturers to meet ADNOC’s standards on safety, reliability, cost control and execution speed.

For Abu Dhabi, the programme reinforces the emirate’s position as a capital-rich energy hub at a time when global oil and gas investment remains uneven. Many international oil companies have become more selective with capital, while national oil companies in the Gulf continue to invest heavily in capacity, downstream integration and gas.

ADNOC’s challenge will be to deliver the contracts without weakening capital discipline. Large project pipelines can stimulate growth, but they also expose companies to execution delays, contractor shortages and market volatility. The company’s emphasis on performance-based partnerships suggests it is seeking to reduce those risks by tying suppliers more closely to delivery milestones and local value creation.

The investment plan signals that ADNOC’s next phase will be judged not only by production growth, but by how effectively it converts energy spending into industrial capacity, export competitiveness and long-term economic value for Abu Dhabi.