Patterson-UTI International Holdings, a subsidiary of Patterson-UTI Energy, signed a non-binding term sheet with ADNOC Drilling to hold a minority equity interest in Turnwell Industries, a company recently formed by ADNOC Drilling. In a statement, Patterson-UTI said it expects that Schlumberger Middle East SA, a subsidiary of SLB, will also hold a minority equity interest in Turnwell. Turnwell has been awarded a $1.7 billion contract to drill and complete 144 unconventional wells for ADNOC.
In exchange for the minority equity interest, Patterson-UTI expects to primarily provide drilling, completion, and other oilfield service expertise to Turnwell, as well as a limited cash contribution to fund its portion of working capital. While Patterson-UTI does not plan to initially contribute or provide drilling and completion equipment, the company may later do so depending on the long-term capital return opportunity.
“We are pleased that ADNOC Drilling recognizes Patterson-UTI as a premier drilling and completions company and technology leader, and we look forward to reaching an agreement to bring our expertise to the initial phase of this groundbreaking project,” said Andy Hendricks, Patterson-UTI’s Chief Executive Officer. “We are excited by the opportunity to partner with ADNOC Drilling and SLB to improve our position in one of the most important oil and gas regions in the world. There is a vast unconventional resource that is expected to be developed in the United Arab Emirates over many years, and we are confident that our expertise and knowledge from our experience in the United States can help Turnwell deliver to the customer US shale-type efficiencies to the drilling and completions process.”