The UAE has signed an agreement to renew the concession for the Al-Bunduq offshore oil field, which it shares with Qatar.

According to Abu Dhabi’s Supreme Petroleum Council (SPC), the deal was reached between Abu Dhabi National Oil Company (Adnoc) and the Japanese consortium managing the field without direct communication with any Qatari party.

“This concession was recently extended by each respective government to the Japanese consortium with no direct communication or engagement between the two states,” an SPC spokesman told Reuters.

“There is no commercial or trading relationship being established between the UAE and Qatar by the extension of this concession.”

SPC’s declaration refutes an earlier statement by Qatar Petroleum in which the Qatari company claimed it signed the the concession renewal deal directly with the SPC and Adnoc.

The original concession agreement for the Al-Bunduq oil field was signed in March 1953, and expired on 8 March 2018.

Oil was discovered in 1965 and began production in 1975. The field’s crude oil production is exported to Japan and other Asian markets.

The Bunduq Company Limited, the field’s operator, was established in 1970, and is majority-owned (97 per cent) by Japan’s United Petroleum Development, with the UK’s BP holding the remaining 3 per cent.

United Petroleum Development is owned by Japanese shareholders Cosmo (45 per cent), JX Nippon (45 per cent) and Mitsui (10 per cent).

“Al-Bunduq is a very mature field. Production is on the decline, finishing in 2031,” Tom Quinn, senior research analyst – Middle East Upstream at Wood Mackenzie, told MEED.

“The extension will allow them [the operators] to produce without interruption to the end of field life,” Quinn said.