Page 10 - MEOG Week 35 2021

MEOG PROJECTS & COMPANIES MEOG

ADNOC awards concession

to PPL-led consortium

UAE ABU Dhabi National Oil Co. (ADNOC) this borders Oman in the south-east. The offshore
week awarded the Offshore Block 5 concession blocks cover the majority of Abu Dhabi’s off-
to a consortium of Pakistani companies led by shore area.
Pakistan Petroleum Ltd (PPL). The block was ADNOC also said that it withdrew Onshore
lone remaining concession from the second Block 2 from the auction following the Novem-
competitive bid round which was launched in ber 2020 discovery of 22bn stock tank bar-
2019. rels (STB) of recoverable unconventional oil
The consortium is comprised of PPL, Oil resources and 160 trillion cubic feet (4.5trn
and Gas Development Company Ltd (OGDL), cubic metres) of recoverable unconventional
Mari Petroleum Company Ltd and Govern- gas resources.
ment Holding Pvt Ltd (GHPL). Under the terms The company said it “intends to engage with
of the deal, the group will hold a 100% stake in potential partners for unconventional resource
the exploration phase of Offshore Block 5, with licensing opportunities around this geographi-
a total investment of up to $305mn envisioned cal area [which] contains some of the unconven-
for exploration and appraisal drilling and a par- tional resources discovered that have production
ticipation fee. potential ranking alongside the most prolific
The deal was signed by UAE Minister North American shale oil plays”.
of Industry and Advanced Technology and In February, ADNOC awarded Offshore
ADNOC managing director and CEO HE Dr. Block 4 to the local subsidiary of Japan’s Cosmo
Sultan Ahmed Al Jaber and PPL CEO and man- Energy, which is the majority owner of Abu
aging director Moin Raza Khan. Dhabi Oil Co. (ADCO) and is predominantly
Should a commercial discovery be made, the known as a refining specialist. As is the norm,
consortium has the right to a minority share in Cosmo took a 100% stake in the exploration
the subsequent 35-year production concession, phase, with ADNOC retaining an option for
with ADNOC taking its customary 60% hold- 60% of the production phase. The contract was
ing. The 6,223-square km acreage covers an area signed for a term of 35 years with Cosmo agree-
north of the 50bn-barrel Upper Zakum oilfield. ing to spend up to $145mn on exploration and
Last month, the consortium formed a special appraisal drilling, including a participation fee,
purpose vehicle (SPV) with each member hold- across the 4,865-square-km offshore concession.
ing an equal 25% share in Pakistan International The deal follows similar agreements in
Oil Ltd which has been registered on the Abu December with US-based Occidental Petroleum
Dhabi Global Market (ADGM). for onshore Block 5 and with a consortium of
Another precursor to the deal was the Italy’s ENI and Thailand’s PTT Exploration and
approval by the government of Pakistan to invest Production (PTTEP) for Offshore Block 3.
$400mn in the block, which at that point was As with those agreements, ADNOC noted
unspecified. that Cosmo would “leverage and contribute
The Economic Coordination Committee financially and technically” to the ongoing mega
approved a summary of the “Petroleum Division seismic survey currently being carried out by
regarding no objection certificate for issuance of China National Petroleum Corp. (CNPC) geo-
the parent company guarantees/corporate guar- physical specialist subsidiary BGP. The scope of
antees by each of the consortium companies, on the 3D onshore and offshore survey was recently
a joint and several basis”. expanded from around 53,000 square km to
Last month, Pakistan Petroleum Ltd (PPL), 82,000 square km, taking the total value of the
Oil and Gas Development Company Ltd contract to $2.12bn. The Pakistani consortium
(OGDL) and Mari Petroleum Company Ltd will be involved in the survey on the same terms
approved the guarantees in favour of ADNOC as the other second round signatories.™
and the Supreme Council for the Financial and
Economic Affairs (SCFEA), which will assume
the regulatory powers of the Supreme Petroleum
Council (SPC).
In a stock exchange filing, Mari Petroleum
said: “In case the block is not awarded to the con-
sortium, the NewCo shall be dissolved.”
Block 5 and the rest of the blocks included in
the second round cover large areas throughout
Abu Dhabi, comprising a total acreage of 34,000
square km. Onshore Block 2 is in the south-west,
bordering Saudi Arabia, while Onshore Block 5

P10 www. NEWSBASE .com Week 35 01•September•2021