Abu Dhabi awards Spanish firm stake in offshore oil concession

Abu Dhabi National Oil Co(ADNOC) said today it has awarded Spanish Cepsa firm a 20 per cent share in a concession of two offshore oil fields in a deal worth USD 1.5 billion. The 40-year deal aims to double production at the emirates offshore fields of SARB and Umm Lulu to 215,000 barrels per day, state-owned ADNOC said in a statement. Its subsidiary, ADNOC Offshore, will retain a 60 percent stake in the project while the remaining 20 per cent will be awarded to another company, the statement said. Cepsa, a global oil and gas company, is wholly-owned by Abu Dhabis Mubadala Investment Company which has assets worth over USD 125 billion. "This long-term agreement is a milestone in the development of Abu Dhabis integrated oil and gas sector and in the delivery of ADNOCs 2030 smart growth strategy," CEO of ADNOC Sultan al-Jaber said. Last week, ADNOC awarded a 10 percent stake in the offshore concession of Lower Zakum to an Indian consortium led by ONGC Videsh company for USD 600 million. ADNOC Offshore also retained a 60 percent stake in that concession, with plans to award the remaining 30 percent to a third company. The aim is to more than double production at Lower Zakum to 450,000 bpd. The vast majority of the United Arab Emirates crude oil reserves are located in Abu Dhabi -- capital of the Gulf emirate.

Abu Dhabi in recent years has granted concessions to ExxonMobil, Total, BP, Shell and Chinas CNPC, among others, as old concessions have expired.
The new concessions have been offered at nearly half the duration of the old concessions -- with ADNOC taking majority stake in the projects.
The national company aims to increase the Abu Dhabis oil production capacity from 3.2 million barrels per day to 3.5 million by the end of 2018.