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ADNOC Begins Partnership Talks for Offshore Oil Concession

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ADNOC Begins Partnership Talks for Offshore Oil Concession

ADNOC Logo
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Abu Dhabi – State-owned Abu Dhabi National Oil Company (ADNOC) announced on Monday it is in advanced discussions with more than a dozen potential partners who have expressed a significant interest in the offshore concession, currently operated by the Abu Dhabi Marine Operating Company (ADMA-OPCO) that expires next March which dates back to 1953.

The current shareholders in Adma-Opco are BP with 14.67 per cent, Total with 13.33 per cent and Japan’s Jodco with 12 per cent. The Abu Dhabi Government, through Adnoc, has a 60 per cent holding and will retain it after the new concession.

The potential partners are a mix of existing concession holders in ADNOC’s offshore fields and new participants.
Recently, ADNOC unveiled the expansion of its strategic partnership model, as well as the active management of its portfolio of assets.

ADNOC’s new approach, which builds on its flexible and enhanced operating model as well as its 2030 growth strategy, will enable the company to unlock and maximize value from across the Group. It will deliver improved revenue streams and ensure smart growth, while also enhancing performance and securing greater access for ADNOC’s products in key growth markets.

ADNOC’s CEO Sultan Ahmed al-Jaber said in Monday's statement that the company was looking for partners to provide technology, expertise, long-term capital and market access, as well as operational efficiency and a willingness to invest in its different parts.

“As part of ADNOC’s new partnership approach, we look forward to working with partners who will bring new and innovative thinking to the table. Partners who can demonstrate tangible value-add to our operations through technology, expertise, long term capital and market access, as well as a shared commitment to drive operational performance and efficiency to deliver smart growth and strong financial returns. Our ideal partners should also be willing to invest across different parts of our value chain” Jaber added.

As ADNOC looks to boost oil production capacity to 3.5m bpd in 2018, offshore development is a strategic focus of the company. Current ADMA-OPCO concession produces around 700,000 barrels per day of oil and is projected to have a capacity of about one million bpd by 2021.

In its gas business, ADNOC will develop a variety of natural gas sources, including tapping into gas caps and undeveloped deep and sour gas reserves. ADNOC aims to stretch the margin of each refined barrel of oil and expand petrochemical production from 4.5 to 11.4 mtpa by 2025.

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FILE PHOTO: European Central Bank President Christine Lagarde and Governor of the Bank of Finland Olli Rehn arrive at the non-monetary policy meeting of the ECB's Governing Council in Inari, Finnish Lapland, Finland February 22, 2023. Lehtikuva/Tarmo Lehtosalo via REUTERS//File Photo
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European Central Bank President Christine Lagarde renewed her call for economic integration across Europe on Friday, arguing that intensifying global trade tensions and a growing technology gap with the United States create fresh urgency for action.
US President-elect Donald Trump has promised to impose tariffs on most if not all imports and said Europe would pay a heavy price for having run a large trade surplus with the US for decades.
"The geopolitical environment has also become less favorable, with growing threats to free trade from all corners of the world," Lagarde said in a speech, without directly referring to Trump.
"The urgency to integrate our capital markets has risen."
While Europe has made some progress, EU members tend to water down most proposals to protect vested national interests to the detriment of the bloc as a whole, Reuters quoted Lagarde as saying.
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When the cash actually enters the capital market, it often stays within national borders or leaves for the US in hope of better returns, Lagarde added.
Europe therefore needs to reduce the cost of investing in capital markets and must make the regulatory regime easier for cash to flow to places where it is needed the most.
A solution might be to create an EU-wide regulatory regime on top of the 27 national rules and certain issuers could then opt into this framework.
"To bypass the cumbersome process of regulatory harmonization, we could envisage a 28th regime for issuers of securities," Lagarde said. "They would benefit from a unified corporate and securities law, facilitating cross-border placement, holding and settlement."
Still, that would not solve the problem that few innovative companies set up shop in Europe, partly due to the lack of funding. So Europe must make it easier for investment to flow into venture capital and for banks to fund startups, she said.