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ADNOC Drilling Company announced today that it has signed an agreement to acquire a 70% stake in SLB's land drilling rigs business in Kuwait and Oman. Image courtesy: ADNOC Drilling
ADNOC Drilling Co. will acquire a 70% stake for $112 million in a joint venture (JV) with SLB's land drilling rigs business in Kuwait and Oman.
The JV comprises eight fully operational land rigs under contract with the respective national oil companies of both countries.
The formation of the JV and the acquisition of a 70% stake, is expected in Q1 2026 once regulatory approvals are secured.
ADNOC Drilling will fund the transaction through its existing debt capacity.
The NYSE-listed SLB, formerly known as Schlumberger Limited, is a technology and services provider to the energy industry.
Through this acquisition, ADNOC Drilling will gain immediate access to earnings, cashflow and returns through two operating land drilling rigs in Kuwait and six in Oman.
"The headline valuation (3.5x EV/EBITDA) is accretive and we estimate could yield a 15% IRR i.e a 200 bps premium to the top end of the domestic framework," said Oliver G Connor, analyst at Citi Research, in a note.
The deal is a first step in meeting the company’s broader ambition to reach a 10% market share in the Oman/Kuwait market (i.e 30 rigs) with the flexibility to bring rigs back to the UAE in the long term, Connor added.
ADNOC Drilling, which is listed on the ADX, expects to consolidate the newly acquired business in its financial reporting from 2026.
(Writing by Brinda Darasha; editing by Seban Scaria)
