PetroChina and ADNOC Sign Offshore Concessions

Source Press Release
Company PetroChinaADNOCCNPCENIInpex CorporationONGC Videsh LimitedTotalEnergies SE 
Tags Licensing Rounds, Deals, Upstream Activities
Date March 21, 2018

PetroChina Company Limited (“PetroChina”) has been awarded stakes in Abu Dhabi’s two offshore oilfield concessions following the signing of agreements with the Abu Dhabi National Oil Company (ADNOC) today.

Under the terms of the agreements, PetroChina Company Limited has been granted a 10% interest in the Umm Shaif and Nasr concession and a 10% interest in the Lower Zakum concession. In February 2017,  PetroChina’s parent company China National Petroleum Corporation (“CNPC”) was awarded an 8% interest in Abu Dhabi’s onshore concession, operated by ADNOC Onshore.  CNPC also has a 40% stake in the Al Yasat concession with  ADNOC.

PetroChina contributed a participation fee of AED 2.1 billion (US $575 million) to enter the Umm Shaif and Nasr concession and a fee of AED 2.2 billion (US $600 million) to enter the Lower Zakum concession. Both concessions will be operated by  ADNOC Offshore, on behalf of all concession partners.

The agreements were signed, in Abu Dhabi, by Dr. Sultan Ahmed Al Jaber, ADNOC Group CEO and Mr. Wang Yilin, Chairman of  CNPC. The agreements have a term of 40 years and are backdated to March 9, 2018.

Dr. Al Jaber said the expanded collaboration with PetroChina further strengthens and deepens the strategic and economic relationship between the United Arab Emirates and China. Energy cooperation is an increasingly important aspect of the UAE’s relations with China, the world’s second largest economy and a major growth market for our products and petrochemicals. These agreements are new milestones in  ADNOC’s thriving partnership with CNPC.

Mr. Wang Yilin, the Chairman of CNPC, said: “We are pleased to participate in the Umm Shaif and Nasr, Lower Zakum concessions. These agreements strengthen our growing relationship with ADNOC, and will help to meet China’s expanding demand for energy and contribute to asset portfolio optimization and profitability enhancement of PetroChina. To promote development of the assets, we will closely collaborate with ADNOC to deploy world class engineering solutions and advanced technology to maximise recovery from these two concessions.”

The Umm Shaif and Nasr concession and the Lower Zakum concession have been created from the former ADMA offshore concession, with the aim of maximising commercial value, broadening the partner base, expanding technical expertise, and enabling greater market access.

The Umm Shaif field’s Arab reservoir is characterised by a huge gas cap – one of the largest in the region - with reserves rich in condensates. The gas cap overlays an oil rim which, in combination with Nasr field, has a crude production capacity of 460,000 bpd. ADNOC plans to process 500 million standard cubic feet of gas per day from Umm Shaif’s gas cap to help meet Abu Dhabi’s growing domestic demand for energy and reduce reliance on imported gas. The gas cap’s condensates will be refined to extract higher value products that can be used in a variety of petrochemical applications.

PetroChina joins  Eni (10%) and Total (20%) as participants in the Umm Shaif and Nasr concession; and an  ONGC Videsh led consortium (10%),  INPEX Corporation (10%),  Eni (5%) and Total (5%) as participants in the Lower Zakum concession.  ADNOC retains 60% majority shares in both concessions.

Source: EvaluateEnergy® ©2021 EvaluateEnergy Ltd