The Abu Dhabi National Oil Company (ADNOC) of the United Arab Emirates' (UAE) and U.S.'s Baker Hughes, the world's biggest oil service firm, signed on Monday a strategic partnership deal that will support the development of ADNOC's subsidiary, ADNOC Drilling, into a drilling and well construction provider, ADNOC said in an e-mailed statement.
As part of the agreement, Baker Hughes, which is part of blue chip firm GE, will acquire a five percent stake in ADNOC Drilling.
The transaction values ADNOC Drilling at approximately 11 billion U.S. dollars. Baker Hughes will be the sole provider of certain proprietary leading-edge and differentiated equipment and technologies related to the integrated drilling offering, said Abu Dhabi government-controlled ADNOC.
Together, ADNOC and Baker Hughes, whose shares are traded on the New York Stock Exchange, will deliver more competitive well completion times, greater drilling efficiencies and better well economics, and will capitalize on new business opportunities as ADNOC Drilling grows through its new expanded offering.
This partnership represents the first time that ADNOC has brought an international strategic partner to acquire a direct equity stake in one of its existing services businesses.
The UAE as a major oil supplier and a member of the Organization of Petroleum Exporting Countries (OPEC) holds approximately seven percent of the world's known oil reserves.
Ninety percent of the UAE's "black gold" is located in the emirate of Abu Dhabi, the capital and biggest of the seven UAE sheikhdoms.
Editor:Cherie
