Abu Dhabi Global Market (ADGM) announced that it has entered into an agreement with the Supreme Petroleum Council in Abu Dhabi (the SPC), according to which ADGM will be able to grant entities that are incorporated in ADGM a licence to carry out onshore and offshore oil field and facilities services (the Oil and Gas Services Activity). 

Prior to such agreement, the Oil and Gas Services Activity was reserved for companies registered “on-shore” in the United Arab Emirates (UAE) outside of a free zone, whereas companies registered in a free zone, such as ADGM, were excluded from carrying out certain types of Oil and Gas Services Activity in Abu Dhabi. The announcement from ADGM signifies an encouraging modification to the way companies can now structure themselves for conducting the Oil and Gas Services Activity in Abu Dhabi. For instance, entities incorporated in ADGM will now be able to register as a supplier of products to Abu Dhabi National Oil Company (ADNOC). Previously, such registration was only available for on-shore entities and a foreign company would need to align its corporate and operational structure with the current foreign ownership restrictions, which often lead to an increase of operational costs for entities conducting services in the UAE. 

Any company conducting the oil and gas activity should consider and review its current corporate and operational structure in the UAE, to determine how the company may benefit from the proposed modifications announced by ADGM.