Adnoc signs $4.6bn in agreements to boost local manufacturing


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Oct 27, 2023

Adnoc signs $4.6bn in agreements to boost local manufacturing

Adnoc has signed agreements worth Dh17 billion ($4.63 billion) with 23 local and

Adnoc has signed agreements worth Dh17 billion ($4.63 billion) with 23 local and international companies to boost the UAE's manufacturing sector.

The agreements are a part of its plan to manufacture several products in its procurement pipeline locally, the state-run oil company said on Thursday.

Last year, Adnoc said it had identified $19 billion worth of products that could be made in the Emirates.

"These agreements reinforce our role as a critical engine for the UAE's industrial growth and they offer significant potential to further increase our GDP [gross domestic product] contributions, stimulate economic diversification and create more skilled job opportunities for UAE nationals," said Saleh Al Hashimi, head of Adnoc's commercial and in-country value (ICV) directorate.

"We look forward to working with these companies to deliver on these important agreements and drive more sustainable value to the UAE."

In 2021, the UAE launched its industrial strategy "Operation 300bn" to position itself as a global industrial centre by 2031.

The 10-year comprehensive road map focuses on increasing the industrial sector's contribution to the country's gross domestic product to Dh300 billion in 2031, from Dh133 billion in 2021.

The strategy focuses on boosting production in 11 priority sectors, supporting the growth of national industries, attracting foreign investment, modernising legislation and ensuring the availability of dedicated financing for local industrial companies.

In November, Adnoc signed agreements worth up to Dh35 billion with 25 companies, including Siemens, Halliburton and Schneider Electric.

As part of a new five-year plan, Adnoc aims to channel Dh175 billion back into the Emirates' economy through its ICV programme.

Last year, the group's ICV programme drove more than Dh35 billion back into the nation's economy and enabled 2,000 UAE citizens to be employed in Adnoc's supply chain.

Adnoc's board has endorsed plans to bring forward the company's plans to expand its oil production capacity to 5 million barrels per day by 2027, from the previous target of 2030, as part of an accelerated growth strategy.

The company has allocated $15 billion to invest in a range of projects by 2030, which will help it accelerate its low-carbon growth strategy.

Adnoc will invest in clean power, carbon capture and storage, further electrification of operations, energy efficiency and new measures to build on its policy of zero-routine gas flaring.

"Adnoc is creating long-term domestic manufacturing opportunities from our procurement pipeline to enhance the UAE's industrial base and strengthen the resilience of our supply chains as we make today's energy cleaner and invest in the clean energies of the future," said Mr Al Hashimi.

Last year, the Abu Dhabi government pledged to invest Dh10 billion across six industrial programmes to more than double the size of the emirate's manufacturing sector to Dh172 billion by 2031.