ADNOC, CNPC sign development deals for offshore concessions
Following closely a similar deal signed earlier this week with Total SA, Abu Dhabi National Oil Co. has signed agreements with China National Petroleum Corp. in which the Chinese company will be awarded stakes in two of Abu Dhabi’s new offshore concessions.
Following closely a similar deal signed earlier this week with Total SA, Abu Dhabi National Oil Co. (ADNOC) has signed agreements with China National Petroleum Corp. in which the Chinese company will be awarded stakes in two of Abu Dhabi’s new offshore concessions (OGJ Online, Mar. 19, 2018).
Under the terms of the agreements, CNPC, through its majority owned listed subsidiary PetroChina, has been awarded a 10% interest in the Umm Shaif and Nasr concession and a 10% interest in the Lower Zakum concession. The concession entry fees are valued at about $1.175 billion, with PetroChina paying $575 million to enter the Umm Shaif and Nasr concession and $600 million to enter the Lower Zakum concession.
Both concessions will be operated by ADNOC Offshore on behalf of all concession partners.
In February 2017, CNPC was awarded an 8% interest in Abu Dhabi’s onshore concession, operated by ADNOC Onshore. It also has a 40% stake in the Al Yasat concession with ADNOC.
The Umm Shaif and Nasr concession, and the Lower Zakum concession have been created from the former ADMA offshore concession, “with the aim of maximizing commercial value, broadening the partner base, expanding technical expertise, and enabling greater market access,” ADNOC said.
Umm Shaif field’s Arab reservoir is characterized by a huge gas cap—one of the largest in the region—with condensates-rich reserves. The gas cap overlays an oil rim which, in combination with Nasr field, has a crude production capacity of 460,000 b/d. ADNOC plans to process 500 MMscfd of gas from Umm Shaif’s gas cap to help meet Abu Dhabi’s increasing domestic energy demand. The condensates, from the gas cap, will be refined to extract higher-value products that can be used in a variety of petrochemical applications.
CNPC joins Eni SPA, 10%, and Total, 20%, as participants in the Umm Shaif and Nasr concession; and an ONGC Videsh-led consortium, 10%, Inpex Corp., 10%, Eni, 5%, and Total, 5%, as participants in the Lower Zakum concession. ADNOC retains 60% majority shares in both concessions.