Page 11 - MEOG Week 50 2020

MEOG TENDERS MEOG

Oxy awarded Abu Dhabi concession

UAE ABU Dhabi National Oil Co. (ADNOC) last Vicki Hollub, Oxy’s president and CEO, said
week announced that it had awarded an explo- that the company has “completed two explora-
ration concession to US-based Occidental Petro- tion wells with extremely promising results”,
leum for the emirate’s onshore Block 5. adding that it sees “see significant potential in
The award has been made by the Supreme Onshore Block 5.”
Petroleum Council (SPC), which last month ADNOC noted that in addition to explor-
gave ADNOC the go-ahead to begin handing atory work, Oxy would “leverage and contrib-
out blocks that were included in Abu Dhabi’s ute financially and technically” to the ongoing
second competitive bidding round, which was mega-seismic survey currently being carried
launched in mid-2019. out by China National Petroleum Corp. (CNPC)
As has become de rigueur for ADNOC, geophysical specialist subsidiary BGP. The scope
Oxy was awarded a 100% stake in the explora- of the 3D onshore and offshore survey was
tion phase and rights to the development and recently expanded from around 53,000 square
production phases of any successful commer- km to 82,000 square km, taking the total value of
cial discovery, at which point ADNOC has the the contract to $2.12bn.
option to take its customary 60% share.
Oxy is expected to spend up to $140mn dur- Broad focus
ing exploration, including a participation fee. Aside from the Oxy deal, ADNOC was also busy
Block 5 covers a 4,212-square km area south- in the trading and downstream sectors last week
east of Abu Dhabi City and borders Oman. as it continues an impressive year of commercial
ADNOC noted that new 3D seismic data has activity.
been acquired that covers a large part of the The company is understood to have hired
concession, which suggests that the block has Standard Chartered Bank to sell waste manage-
“promising potential”. The term of the produc- ment assets on behalf of its ADNOC Refining
tion phase is 35 years from the date exploration subsidiary. Sources spoken to by Reuters said
commences. that the assets could be worth around $500mn
The block lies adjacent to the 11,000-square and that “many potential bidders have already
km Block 3, which was awarded to Oxy during been approached”.
the first competitive bidding round in 2019. ADNOC Refining is a joint venture in which
The first bid round was a great success, with Eni and OMV acquired interests of 20% and
five licences apportioned covering an area of 15% respectively in 2019 for a combined $5.8bn.
30,000 square km. Aside from Oxy’s award, The company’s assets include the 837,000 barrel
offshore Blocks 1 and 2 were won by Italy’s Eni per day Ruwais refining complex in the Western
and Thailand’s PTT Exploration & Production; Region and an ageing 85,000 bpd facility near
Bharat Petroleum Corp. and Indian Oil Corp. Abu Dhabi City, as well as a 1,900-km pipeline
(IOC) were awarded Onshore Block 1 and Inpex network.
took Onshore Block 4. Last week, the same three companies began
In a statement to HE Dr. Sultan Ahmed operations of their ADNOC Global Trading
Al Jaber, the UAE Minister of Industry and (AGT) JV following the start of trading by their
Advanced Technology and ADNOC Group crude-focused ADNOC Trading in September.
CEO said that the round was “very competitive” AGT specialises in refined products and will
and noted the emirate’s “strategy aimed at accel- trade light and middle distillates, including jet,
erating the exploration and development of our naphtha, diesel and gasoline, in addition to spe-
substantial hydrocarbon resources”. cialty products.™

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