Abu Dhabi is preparing to start the process of finding partners for one of its three major oil production concessions, the offshore Abu Dhabi Marine Operating Company (Adma-Opco).

The current concession, held by Abu Dhabi National Oil Company (Adnoc) and three international shareholders, expires in March 2018, and the state energy group has just over 18 months to select partners for a new joint venture.

Adma-Opco, whose activities date back to the 1950s, was formed in 1977 to operate offshore oil and gas fields. It currently produces from several fields including the Lower Zakum and Umm Shaif assets. It is a joint venture of Adnoc (60 per cent), the UK’s BP (14.67 per cent), France’s Total (13.33 per cent) and Japanese Oil Development Company (Jodco; 12 per cent).

“The existing Adma-Opco concession is due to expire in March 2018 and Adnoc intends to tender up to 40 per cent of the rights in the new Adma-Opco concession in the future and to finalise the process thereafter,” a spokesperson from Adnoc told MEED. “We look forward to working with value-add partners who share an equal commitment to health, safety and environment as well as operational efficiency and performance.” 

UAE crude production (million barrels a day)
2009 2.2
2010 2.3
2011 2.6
2012 2.7
2013 2.8
2014 2.8
2015 3
Source: Opec

 

Adnoc is preparing to go ahead with the concession renewal despite a long-term discussion over merging its two main offshore oil producers, the other being Zakum Development Company (Zadco). The two firms operate the respective Lower Zakum and Upper Zakum field – essentially two parts of the same asset.

Finding a new partnership to operate the offshore fields could be a lengthy process, with several international oil companies (IOCs) likely to be interested in entering the concession. With this in mind, Adnoc’s leadership should want to receive proposals to assess by the second half of 2017.

The formation of a new concession to operate the emirate’s onshore oil and gas fields has taken longer than anticipated. Abu Dhabi Company for Onshore Petroleum Operations (Adco) expired at the start of 2014 and it was not until January 2015 that the first partner entered the new concession. Adnoc is still looking for partners for the remaining 22 per cent interest available after contracting 18 per cent to IOCs in 2015.

Adma-Opco’s expiry in 2018 comes at a transformational time for the company’s assets as it carries out a significant expansion of its oil production capacity.

Former CEO Ali al-Jarwan said in November 2015 that the company aims to boost capacity to 1 million barrels a day (b/d) from 650,000 b/d. This will come largely from the development of the Nasr, Satah al-Razboot (Sarb) and Umm al-Lulu fields, on which Adma-Opco awarded more than $7bn-worth of engineering, procurement and construction (EPC) contracts in 2013 and 2014.

Al-Jarwan was replaced by Yasser Saeed al-Mazrouei as part of a recent reshuffle in the leadership of Adnoc and several of its operating companies.

Adma-Opco recently cancelled an estimated $500m project aimed at sustaining crude production from the Umm Shaif field for technical reasons. The company received EPC bids in October 2015 from three firms.

 UAE Outlook 2016 report

UAE Outlook 2016 report

UAE Outlook 2016 report

UAE Outlook 2016 is the latest premium research report by MEED Insight.

For more details and to purchase a copy visit: http://buy.meed.com/UAE-Outlook-report-p/uae-outook-2016.htm