Adnoc to announce oil and gas bid round winners before April

09 January 2019
Adnoc is also looking at launching a second licensing round

Abu Dhabi oil officials expect to announce the winners of the UAE’s first ever oil and gas licensing round by the end of March, and the emirate’s oil company is looking at the possibility of launching a second round.

“We are ready to award. By the end of Q1 2019 we will have completed the announcements,” said Abdulmunim al-Kindy, upstream director at state-owned Abu Dhabi National Oil Company (Adnoc).

Speaking on the sidelines of an energy forum in Abu Dhabi, Al-Kindy said the company was “sizing all opportunities for conventional, unconventionals, oil and gas,” as it looks to generate further interest from international oil companies.

“This will cover the whole area. It's not limited to one area. We will announce at the right time,” Al-Kindy said.

“We will continue to appraise our unconventional base in Abu Dhabi and there’s potential to go beyond the ones we announced last year,” he added.

Adnoc, which accounts for most of the UAE's oil output, launched its first oil and gas exploration licensing last March, offering two offshore and four onshore acreages covering a total of 30,000 square kilometres, as it seeks to unlock untapped resources across the emirate.

The licensing round reinforces Adnoc’s long term production growth ambitions of hitting a crude oil production capacity of 4 million barrels a day (b/d) by the end of 2020, and 5 million b/d by 2030. The company is currently in the closing stages of reaching its long held ambition of having the capacity to produce 3.5 million b/d, up from about 3.1 million b/d.

The exploration bid round is a change from Adnoc’s traditional approach to developing Abu Dhabi's oil and gas resources, which has focused on direct negotiations with international oil companies. Last April, it completed its search for for new partners needed to boost output from its producing Gulf assets under the former Adma offshore concession, awarding the final stake to OMV.

The successful companies will then be given exploration rights and provided they reach defined targets, will be granted the opportunity to produce any discoveries with Adnoc.

Some of the blocks already have discoveries. The offshore blocks contain 75 prospects and leads, with 224 targeted reservoirs, while onshore there are a further 36 prospects and 83 targeted reservoirs, according to Adnoc officials when the bid round was launched. Exploration is expected to last two to three years, after which Abu Dhabi will decide on a framework and operating model with the winning bidders.

Adnoc will not take part in the exploration phase itself, but will hold a 60 per cent stake in the blocks once they move into the development phase, which could last between 30 and 40 years, Jaber said. There is also the potential for the winning bidders to recoup some of their investments during the exploration phase from Adnoc, he said.

Both Adnoc officials stressed the key parameters for the bid round would meet Adnoc's new strategic criteria for partnerships - a criteria that includes technical expertise and market access.

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