Abu Dhabi's push to increase its oil production capacity is gathering momentum with the impending award of a major work contract for one of the world's largest oilfields.
After a lengthy tendering process, the Zakum Development Company (Zadco) is close to awarding the first of two large engineering, procurement and construction contracts to boost capacity at the Upper Zakum field from 500,000 barrels per day (bpd) to 750,000 bpd by 2016.
Three contractors - J Ray McDermott, Saipem and Technip - are preparing bids ahead of the deadline on Sunday. A fourth bidder, Hyundai Heavy Industries, has been disqualified.
The field has been recognised as one of the world's major hydrocarbon deposits since the 1970s, but was initially seen as a non-commercial proposition because of the technical challenges of extracting oil from the rock formation when it was first discovered in 1963.
Production reached its current levels after ExxonMobil joined Zadco, a joint venture led by Abu Dhabi National Oil Company (Adnoc), and committed its technology to the extraction of the crude in 2006.
Upper Zakum is the largest part of a reservoir that is now classed as the second-largest field in the Gulf and the fourth-largest in the world.
Most of the new facilities will be housed on artificial islands, which are already being built.
A second contract to complete the expansion is scheduled to attract bids next month.
The upgrading of Upper Zakum is the most significant step yet by Adnoc to fulfil its long-held target to increase Abu Dhabi's production capacity from 2.8 million bpd to 3.5 million bpd. Such upgradings help to maintain the emirate's position as Opec's fourth-largest producer, and to protect its market share in the growing economies of Asia, the recipient of the bulk of its crude.
Abu Dhabi is "protecting relative strength within Opec", said Samuel Ciszuk, a consultant with KBC Energy Economics.
"Without expansion, Abu Dhabi would effectively be in decline … and would become a smaller player relative to other countries."
Saudi Arabia and Iraq are both engaged in major capacity expansions. Such work is also welcome news for oil-importing countries.
The International Energy Agency, which represents 28 oil consumers, has long warned that insufficient production increases would lead to a supply crunch that could undermine the global economy.
Crude prices have surged in recent weeks as sanctions on Iran combined with reduced or interrupted exports from South Sudan, Syria and Libya heightened fears of an impending supply impasse.
The deadline for Abu Dhabi's production rise to 3.5 million bpd has been pushed back several times, moving from 2006 to last year, to the current target of 2018. Since 2009, Adnoc subsidiaries have started to award contracts to raise capacity at existing developments, and to tap undeveloped fields.
The award of the first Upper Zakum project was originally due to be made at the end of last year, but was delayed because companies had to resubmit their technical bids to accommodate changing technical specifications, according to sources involved in the process. The upgrade of Upper Zakum capacity will be developed in three phases. The first phase will boost production capacity by 100,000 bpd, and a further 150,000 bpd will be added in the second phase.
A final phase will ensure that production can be maintained over a 25-year period.
fneuhof@thenational.ae
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Company Fact Box
Company name/date started: Abwaab Technologies / September 2019
Founders: Hamdi Tabbaa, co-founder and CEO. Hussein Alsarabi, co-founder and CTO
Based: Amman, Jordan
Sector: Education Technology
Size (employees/revenue): Total team size: 65. Full-time employees: 25. Revenue undisclosed
Stage: early-stage startup
Investors: Adam Tech Ventures, Endure Capital, Equitrust, the World Bank-backed Innovative Startups SMEs Fund, a London investment fund, a number of former and current executives from Uber and Netflix, among others.
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Croatia: Rebic (53'), Modric (80'), Rakitic (90' 1)
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
Profile of Whizkey
Date founded: 04 November 2017
Founders: Abdulaziz AlBlooshi and Harsh Hirani
Based: Dubai, UAE
Number of employees: 10
Sector: AI, software
Cashflow: Dh2.5 Million
Funding stage: Series A
Global state-owned investor ranking by size
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Timeline
2012-2015
The company offers payments/bribes to win key contracts in the Middle East
May 2017
The UK SFO officially opens investigation into Petrofac’s use of agents, corruption, and potential bribery to secure contracts
September 2021
Petrofac pleads guilty to seven counts of failing to prevent bribery under the UK Bribery Act
October 2021
Court fines Petrofac £77 million for bribery. Former executive receives a two-year suspended sentence
December 2024
Petrofac enters into comprehensive restructuring to strengthen the financial position of the group
May 2025
The High Court of England and Wales approves the company’s restructuring plan
July 2025
The Court of Appeal issues a judgment challenging parts of the restructuring plan
August 2025
Petrofac issues a business update to execute the restructuring and confirms it will appeal the Court of Appeal decision
October 2025
Petrofac loses a major TenneT offshore wind contract worth €13 billion. Holding company files for administration in the UK. Petrofac delisted from the London Stock Exchange
November 2025
180 Petrofac employees laid off in the UAE
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Jebel Ali Dragons 26 Bahrain 23
Dragons
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Cons: Love
Pens: Love 3
Bahrain
Tries: Kenny, Crombie, Tantoh
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Pens: Phillips 2
