Abu Dhabi National Oil Company (Adnoc) signed an agreement awarding Austrian firm OMV a 20 per cent stake in Abu Dhabi’s SARB and Umm Lulu offshore concession.
The signing of the agreement, which has a term of 40 years from March 9, 2018 was witnessed by His Highness Shaikh Mohammad Bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, and Sebastian Kurz, Chancellor of Austria, Adnoc said in a statement on Sunday.
“With this deal, concession rights in offshore fields in Abu Dhabi have been awarded to a prestigious group of international companies with vast experience, strengthening the UAE’s partnerships that ensure a significant stake of its hydrocarbon resources in international markets for years to come,” said Shaikh Mohammad. “The agreement reaffirms the UAE’s firmly established stature in this vital sector.”
OMV contributed a participation fee of $1.5 billion (Dh5.5 billion) to enter the concession. Adnoc retains a majority 60 per cent stake in the offshore concession that will be operated by Adnoc offshore.
“The expansion of the global economy and increasing demand for oil, refined products and petrochemicals, provide us with new opportunities to create value across our upstream and downstream business,” Dr Sultan Ahmad Al Jaber, Adnoc Group Chief Executive Officer said in a statement.
“To seize these opportunities, we will work closely with OMV, and our other partners to further optimise operational efficiencies, enhance performance, and capture future growth opportunities.”
“OMV’s strong track record in deploying advanced technologies to cost-effectively increase recovery rates from mature fields will help enable Adnoc to continue to be a reliable supplier of oil for decades to come.”
OMV is Austria’s largest listed company and is part-owned by a subsidiary of Mubadala Investment Company. The Austrian firm joins Spanish oil company Cespa as a shareholder in the concession which has a production capacity of 215,000 barrels of oil per day.
With the signing of the agreement on Sunday, Adnoc completed the round of offshore concession awards, which has seen the company bring on board a number of partners including India’s ONGC and France’s Total, among others.
Collectively the offshore agreements have contributed $7.92 billion (Dh29.1 billion) in participation fees and secured markets for 40 per cent of the UAE’s oil for the next 40 years.
“This deal represents a deepening of OMV’s existing involvement in Abu Dhabi. For OMV the deal allows them to use their investment budget to expand their Middle East upstream portfolio and see OMV’s expansion throughout the petroleum value chain,” Jaafar Al Taie, managing director of Manaar Energy group told Gulf News.
OMV is already involved in midstream and specifically petrochemical ventures with Adnoc, such as Borealis.
“From Adnoc’s perspective, this is a continuation of the company’s priority to diversify the global portfolio of participants in its upstream sector,” he added.
The two companies are also working together to explore potential opportunities in downstream businesses.
Source: Gulf News