In The Spotlight
Amin H. Nasser, president and CEO, Aramco. (Image source: Aramco)
Aramco records robust Q1 2025 performance
Aramco recorded a robust Q1 financial and operational performance, with net income of US$26bn, slightly down from US$27.3bn in Q1 2024, and capital expenditure of US$12.5bn
The decrease in net income was mainly due to the impact of lower revenue and other income related to sales as well as higher operating costs.
Capital expenditure for Q1 2025 was up from US$10.8bn for the Q1 2024, mainly due to the expansion of gas development.
Upstream developments
In the upstream sector, Aramco recorded total hydrocarbon production of 12.3 mmboed in the first quarter of 2025 and made 14 new oil and gas discoveries in the Eastern Province and Empty Quarter. The company progressed increment projects to maintain MSC at 12.0 mmbpd, including water injection operations to support the reservoir and crude oil production continued for the Dammam development project, and procurement and construction activities advanced for the Marjan and Berri and Zuluf crude oil increments. Aramco progressed its strategy to increase sales gas production capacity by more than 60%, including advancing procurement and construction activities for the Jafurah Gas Plant, part of the Jafurah unconventional gas field development, as well as for the Tanajib gas plant and Fadhili gas plant expansion.
Downstream, Aramco made progress in capital projects such as the construction of the refinery-integrated petrochemical steam cracker being developed by S-OIL, the Amiral expansion at the SATORP refinery, and other projects. Aramco also progressed the strategic expansion of its global retail network, with agreements to acquire 25% equity stake in Unioil Petroleum Philippines, one of the largest petroleum companies in the Philippines.
In the lower carbon sector, the company made headway in blue hydrogen development, completing the acquisition of 50% equity interest in Blue Hydrogen Industrial Gas company, a subsidiary of APQ, through which Aramco and APQ plan to develop a lower-carbon hydrogen network in the Kingdom’s Eastern Province, and launched a CO2 Direct Air Capture pilot plant, marking a significant step in the company’s efforts to expand its DAC capabilities and set to accelerate DAC deployment throughout the region.
Aramco president & CEO Amin H. Nasser said, “Global trade dynamics affected energy markets in the first quarter of 2025, with economic uncertainty impacting oil prices. In this context, Aramco’s robust financial performance once again demonstrated the company’s unique scale, its reliability and flexibility, the value of its low-cost operations, and its emphasis on efficiency and advanced technology.”
The countries of the region are keen to unlock the potential of their unconventional resources. (Image source: Adobe Stock)
Core Laboratories opens Unconventional Core Analysis Laboratory in Saudi Arabia
Core Laboratories, a leading provider of proprietary and patented reservoir description and production enhancement services, has launched a state-of-the-art Unconventional Core Analysis Laboratory in Dammam, Kingdom of Saudi Arabia, developed in collaboration with its partner, Abdulla Fouad Group
The Abdulla Fouad Core Lab facility is set to become a central hub for unconventional core analysis in the region, providing valuable insights into unconventional reservoir properties, thereby assisting the operator in optimising the appraisal, development, and production of these unconventional fields. The laboratory is equipped with advanced proprietary instrumentation designed to provide comprehensive core and fluid analysis services tailored to unconventional reservoirs. This will assist senior scientists in performing enhanced petrophysical analysis and digital rock characterisation, using a number of advanced technologies and analytical techniques, including dual energy CT-scanning, high-frequency Nuclear Magnetic Resonance ('NMR'), and Core’s proprietary PRISM workflow. These services are designed to provide clients with detailed reservoir rock and fluid characterisation, facilitating informed decision-making throughout the appraisal, development, and production lifecycle.
“The introduction of these laboratory capabilities represents a significant milestone in our ongoing efforts to support the energy sector's evolving needs,” said Larry Bruno, CEO of Core Laboratories. “This collaboration with Abdulla Fouad reflects our shared vision of leveraging innovative solutions to address the complexities of unconventional resource development.”
Unlocking the potential
The countries of the region are keen to unlock the potential of their unconventional oil and gas resources. Saudi Arabia is home to the Jafurah gas field, the largest liquid-rich shale gas play in the Middle East, estimated to contain more than 200 trillion scf of gas and 75bn bbl of condensates. The field is currently being developed, with initial production expected to commence in 2025 and plans to ramp up to reach a sustainable sales gas rate of two billion scfd by 2030, in addition to significant volumes of ethane, Natural Gas Liquids (NGL) and condensate.
While Abu Dhabi holds an estimated 220 bbl of unconventional oil and 460 Tcf of unconventional gas in place. ADNOC is currently unlocking potential unconventional gas resources as part of its integrated gas strategy so that the UAE will become gas self-sufficient by 2030, with additional 1 billion cubic feet per day (bcfd) set to be unlocked from the Ruwais Diyab concession before 2030.
ADNOC Drilling recorded strong growth in revenue and profits in the first quarter of 2025. (Image source: ADNOC Drilling)
ADNOC Drilling continues on strong growth trajectory
ADNOC Drilling recorded strong growth in revenue and profits in the first quarter of 2025, building on its growth trajectory
The company reported a 32% increase in year-on-year in revenue to US$1.17bn and a 24% rise year-on-year in profits to US$341mn. It follows record growth and financial results in 2024.
The first quarter results were on the back of particularly strong growth in revenues in oilfield services, where revenue increased 134% year-on-year to US$342mn, mainly driven by the unconventional business, along with increased integrated drilling services (IDS) activity. Onshore revenue increased 20% year-on-year to US$494mn. While offshore revenue increase 2% year-on=year to US$334mn, mainly due to higher activity island rigs. This is set to continue with the recent award of US$806mn long-term contract for three newbuild island rigs by ADNOC Offshore to support expanding operations at the offshore Zakum development project.
Abdulrahman Abdulla Al Seiari, ADNOC Drilling CEO, said: “The first quarter of 2025... has demonstrated our financial resilience and laid the foundation for another year of significant growth. We are progressing at pace on our strategic priorities, expanding our rig fleet, scaling our oilfield services offering and advancing our AI and digital capabilities.
“With a robust revenue pipeline, sustained demand, growing international interest and unparalleled visibility of future earnings, ADNOC Drilling is well positioned to deliver sustainable growth and value for our shareholders.”
ADNOC Drilling is now expanding its footprint beyond the UAE, through pre-qualification and ongoing tenders in Oman and Kuwait, and continues to focus on innovation through its joint ventures with Enersol, ADNOC Drilling’s advanced energy technology platform, and Turnwell, ADNOC Drilling’s joint venture with SLB and Patterson UTI. The latter has delivered a step-change in UAE unconventional energy development, achieving a significant reduction in well delivery times through the deployment of advanced AI and digital tools. Turnwell has helped ADNOC with the production and treatment of the nation’s first unconventional gas from the Ruwais Diyab Concession, located 200 km from Abu Dhabi.
The petrochemical industry is increasingly turning its attention to chemical recycling. (Image source: Synergy)
Circular chemistry: chemical recycling and the petrochemical industry
As environmental concerns and regulatory pressures gain precedence, the petrochemical industry is increasingly turning its attention to chemical recycling
Often positioned as a potential game-changer, this technology seeks to offer a more sustainable path by converting plastic waste back into its original chemical components, enabling the production of new materials with properties comparable to those made from virgin feedstocks. Its attractiveness lies in addressing the twin evils – the plastic waste crisis and the need for higher-quality recycled materials.
How does chemical recycling work?
Chemical recycling, also referred to as advanced recycling, differs from mechanical recycling in both process and potential. Rather than grinding and melting plastics, it involves breaking down polymers into monomers or other base chemicals through processes such as pyrolysis, gasification, or depolymerisation. This allows for the creation of new plastics suitable for applications that require high purity, including food-grade packaging, where mechanically recycled plastics often fall short.
Several companies around the world have begun to scale up their chemical recycling initiatives.
• ExxonMobil, for example, has announced plans to invest US$200mn to expand its chemical recycling capabilities at its Baytown and Beaumont complexes in Texas. With its proprietary Exxtend technology, the company aims to process up to half a million tons of plastic waste per year by 2027.
• In Europe, Eastman Chemical is building a US$1bn molecular recycling facility in France. Once operational, it is expected to recycle up to 160,000 tons of plastic waste annually using polyester renewal technology.
• In India, Reliance Industries has become a pioneer in this space, producing circular polymers at its Jamnagar refinery, which has received ISCC-Plus certification to ensure sustainability and traceability.
However, the economic challenges associated with chemical recycling are substantial. These technologies are energy-intensive, resulting in higher operational costs compared to traditional recycling or even the production of virgin plastics. In some cases, chemically recycled polyethylene terephthalate (PET) can cost two to three times more than its virgin counterpart, limiting its competitiveness. Additionally, the process often requires clean and sorted plastic waste as feedstock, which is difficult to obtain in many regions due to inadequate waste segregation and contamination. This issue not only affects cost but also scalability.
Advantages of chemical recycling
From an environmental standpoint, chemical recycling does offer certain advantages. Studies indicate that pyrolysis — a commonly used method in chemical recycling — can emit up to 50% less CO₂ than the incineration of mixed plastic waste. The process also has the potential to eliminate hazardous substances embedded in plastics, such as legacy chemicals and substances of very high concern (SVHC), resulting in cleaner end-products. Nevertheless, these benefits must be weighed against the significant energy inputs required for these processes. Without low-carbon energy sources or efficiency improvements, the net environmental gains may be limited.
Looking ahead, the development of chemical recycling will depend on a combination of technological, regulatory, and economic factors. Enhancing waste collection and sorting infrastructure will be crucial for improving feedstock quality. Policy frameworks that clearly define recycled content and support traceability will help create market confidence. Meanwhile, collaboration between governments, research institutions, and industry stakeholders could accelerate innovation and reduce costs over time.
While chemical recycling is unlikely to single-handedly resolve the petrochemical sector’s sustainability challenges, it may play a valuable role within a broader strategy for circularity. When complemented by upstream design changes, responsible consumption, mechanical recycling, and waste minimization efforts, it has the potential to contribute meaningfully to the sector's transition.
Whether it ultimately transforms the petrochemical industry or becomes a niche complement to existing methods will depend on how these challenges are addressed in the years to come.
This article is authored by Synergy Consulting IFA.
The Middle East continues to develop its fossil fuels, along with renewables. (Image source: Adobe Stock)
DNV report highlights Middle East energy sector optimism
Optimism about industry growth in the energy sector, as well as about energy transition prospects, is stronger in the Middle East and North Africa than anywhere else in the world, according to DNV’s Energy Insights 2025 Report
According to the report, based on an annual survey of more than 1,100 senior professionals, 84% of respondents in the Middle East and Africa express optimism about energy industry growth prospects compared to 68% globally, and this figure has risen sharply from 69% last year. The report highlights that the energy sector is booming in the region, as many countries look to develop both their renewable and fossil fuel resources, noting that it has become the fastest-growing renewables market outside China, mainly thanks to solar sector growth. Installed solar capacity is forecast to rise to 100GW of installed capacity by 2030, up from just 23GW today, with Saudi Arabia looking to generate half of its domestic electricity from renewables by 2030, including 40GW of solar PV – six times the current capacity. Early this year Masdar announced a 5.2GW solar plant combined with a 19GWh battery storage facility, making it the largest combined solar battery energy storage system (BESS) in the world.
At the same time, the region is continuing to develop its fossil fuels, particularly natural gas, DNV notes. Iran, Qatar, and Saudi Arabia are in the world’s top ten natural gas producers, while other countries are also growing production. The combination of gas and solar is a winning one, with solar offering a cheaper and cleaner way to meet rising domestic electricity demand, while natural gas can be profitably exported.
Middle East and Africa respondents are most optimistic about reaching revenue and profit targets in the year ahead, at 73% and 71% respectively, compared with 63%/54% in North America, 58%/48% in Europe, 55%/52% Asia Pacific and 63%/54% Latin America.
Uncertain political environment
The report highlights the uncertain policy and geopolitical environment, particular in the US, with political risk seen as the leading constraint to growth. Recent geopolitical shifts have caused considerable uncertainly, with a lot of capital being diverted from renewables into oil and gas, and emerging technologies such as green hydrogen CCS, green steel and synthetic fuels being negatively impacted.
Reflecting this uncertainty, several oil and gas companies, (bp for example), have scaled back renewables commitments over the past year and increased their investment in fossil fuels. 53% of oil and gas sector respondents say they will prioritise fossil fuels over renewables over the next five years — up from 46% a year ago, while 24% of respondents in the power sector are looking to prioritise fossil fuels over renewables over the next five years, more than double the figure (11%) of a year ago. While optimism in the oil and gas sector has held steady over the past two years, standing at 66% in 2025, most oil and gas respondents (60%) say that political issues such as elections, policy uncertainty and regime change are a major threat to success in the year ahead.
Policy reversals and uncertainty are expected to hold back the energy transition in some sectors and regions, with only 55% of energy industry professionals now believing the energy transition is accelerating, sharply down from 79% two years ago. A key factor noted is the shift in investor sentiment. However, many organisations continue to invest in sustainable energy, taking a medium to long-term view.
Certain parts of the world are positive about the pace of the energy transition, notably the Middle East and Africa region, where 77% say the pace of the energy transition is accelerating, and Asia Pacific, where the figure is 68%. In contrast, only 47% in North America and 48% in Europe think the pace is accelerating.
"Despite global economic and political uncertainty, most of the energy industry maintains a general optimism, supported by megatrends such as electrification and energy demand," says the report. "Energy security and affordability have become priorities and are influencing both oil and gas expansion and the acceleration toward renewables. Sentiment varies from region to region, with the Middle East and Africa the most optimistic, and North America the least."
The groundbreaking ceremony. (Image source: TotalEnergies)
TotalEnergies and OQEP break ground on Marsa LNG plant
TotalEnergies and OQ Exploration and Production (OQEP) have broken ground on the Marsa LNG plant in the port of Sohar, northern Oman
The 1 million ton per year (Mt/y) liquefaction plant is being built by Marsa LNG LLC, a joint company between TotalEnergies (80%) and OQEP (20%). LNG production is expected to start in the first quarter of 2028, to serve the marine fuel market in the Gulf.
With an investment of US$1.6bn, Marsa LNG Project will become the Middle East’s first dedicated LNG bunkering hub. Once operational, the facility will provide cleaner fuel alternatives for the shipping industry, underpinning the nation’s economic diversification and environmental sustainability objectives while marking a transformative step for the region’s maritime sector.
A new LNG bunkering vessel is currently under construction, which will be stationed in Sohar from 2028 to supply LNG to a wide range of vessels.
The Marsa LNG plant is fully electrified and has a 300 megawatt-peak (MWp) photovoltaic solar farm, making it one of the lowest carbon intensity LNG plants in the world, with less than 3 kg CO2e/boe of scope 1 and 2 emissions.
Major contracts
Three major contracts have been signed relating to the construction of the hub. WSP International Oman Branch was awarded a consultancy services contract, to provide project management, back-office support, design review, site supervision, and contract management. The second agreement was signed with Boskalis International Oman Branch for dredging works, involving the removal of approximately 3.8mn cubic meters of material to develop the access channel, berth pocket, and turning circle, with project completion expected in September 2025. The third contract was awarded to Six Construct LLC Oman Branch, covering the construction of the LNG jetty, shore protection, and drainage systems.
"I'm very proud to see Marsa LNG breaking ground, alongside our longstanding partner OQEP, and with the strong support from the Sultanate’s authorities. This flagship project demonstrates that LNG production can be very low carbon, contributing to making gas a long-term transition fuel. With an ambitious technical design, we intend to set the standard and pave the way for the next generation of low-emissions LNG plants across the world. We also offer an effective way to support the shipping sector’s energy transition, by providing lower-emissions marine fuel in a key location at the entrance of the Gulf,” said Patrick Pouyanné, chairman and CEO of TotalEnergies.
His Excellency Salim bin Nasser Al Aufi, Minister of Energy and Minerals, stated, “This project marks a significant step in advancing low-emission energy solutions, reinforcing Oman's position as a reliable regional hub for clean maritime fuel. It aligns with the objectives of Oman Vision 2040, particularly in sustainability and industrial innovation. Additionally, it underscores our dedication to providing responsible energy solutions for the global shipping sector while actively reducing its carbon footprint.”
"As the first LNG bunkering hub in the Middle East, Marsa LNG will play a pivotal role in reducing emissions in the shipping industry while reinforcing Oman’s position as a key player in the global energy sector," added Ahmed Al Azkawi, CEO of OQEP.
Offshore rig attrition by type and annual marketed utilisation. (Image source: Westwood)
Offshore rig market sees tailing off in demand: Westwood
Saudi Aramco’s suspension of over 30 jackup contracts by up to one year is a factor behind the tailing off in demand in the offshore rig market, according to new research from Westwood
This suspension is related to the deferral of some expansion projects following the decision to maintain maximum sustainable capacity at 12 mn bpd rather than raise it to 13mn bpd as originally planned.
Other factors behind the dampening of offshore rig market demand are the entry of newbuild rigs in the market and the deferment of several long-term deepwater drilling and P&A projects.
With the combination of a drop in demand and increase in supply, marketed utilisation fell to 88% as of March 2025, representing a fall of 6% in less than two years.
Westwood predicts utilisation of the combined jackup, semisub and drillship segments to fall further this year to around 85%, making it likely that more rigs could permanently be removed from the active drilling fleet this year.
So far this year, nine rigs have been confirmed for removal from the active fleet: four jackups, three semisubs and two modern ultra-deepwater drillships.
The average age of assets retired from the fleet has continued to reduce for floating rigs, but not for jackups. Along with falling utilisation and age, factors increasing the likelihood of a rig being scrapped are limited future prospects, being without work or cold-stacked for some time, and being due for a five-yearly special periodic survey (SPS), which can be expensive.
Other factors can be one-off designs in a contractor’s fleet, where they may not be able to spread spare parts costs etc, outdated designs, and mergers between owners, which can lead to the streamlining of fleets.
“To sum up, due to the reduction in jackup, drillship and semisub demand and utilisation this year, we will likely see more assets moved to cold stack due to not having follow-on commitments in place,” concludes Westwood. “Meanwhile, further M&A activity could also be in the works.
“These factors we believe will spur further older, idle and surplus assets to be removed from the fleet, which in the long run may help set the stage for a stronger recovery in utilisation from the second half of 2026 onwards, when Westwood expects to see a rebound in demand.”