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ADNOC Begins Partnership Talks for Offshore Oil Concession

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ADNOC Logo
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ADNOC Begins Partnership Talks for Offshore Oil Concession

ADNOC Logo
ADNOC Logo

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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IMF: Pakistan Wins More Financing Assurances from Saudi Arabia, UAE, China

Pakistan’s Prime Minister Shehbaz Sharif (Asharq Al-Awsat)
Pakistan’s Prime Minister Shehbaz Sharif (Asharq Al-Awsat)
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IMF: Pakistan Wins More Financing Assurances from Saudi Arabia, UAE, China

Pakistan’s Prime Minister Shehbaz Sharif (Asharq Al-Awsat)
Pakistan’s Prime Minister Shehbaz Sharif (Asharq Al-Awsat)

Pakistan has received “significant financing assurances” from China, Saudi Arabia and the United Arab Emirates linked to a new International Monetary Fund (IMF) program that go beyond a deal to roll over $12 billion in bilateral loans owed to them by Islamabad, IMF Pakistan Mission Chief Nathan Porter said on Thursday.

Porter declined to provide details of additional financing amounts committed by the three countries but said they would come on top of the debt rollover.

The IMF's Executive Board on Wednesday approved a new $7 billion loan for cash-strapped Pakistan, more than two months after the two sides said they had reached an agreement.

The loan — which Islamabad will receive in installments over 37 months — is aimed at boosting Pakistan's ailing economy.

“I won't go into the specifics, but UAE, China and the Kingdom of Saudi Arabia all provided significant financing assurances joined up in this program,” Porter told reporters on a conference call.

The global lender said its immediate disbursement will be about $1 billion.

In a statement issued Thursday, the IMF praised Pakistan for taking key steps to restore economic stability. Growth has rebounded, inflation has fallen to single digits, and a calm foreign exchange market have allowed the rebuilding of reserve buffers.

But it also criticized authorities. The IMF warned that, despite the progress, Pakistan’s vulnerabilities and structural challenges remained formidable.

It said a difficult business environment, weak governance, and an outsized role of the state hindered investment, while the tax base remained too narrow.

“Spending on health and education has been insufficient to tackle persistent poverty, and inadequate infrastructure investment has limited economic potential and left Pakistan vulnerable to the impact of climate change,” it warned.

Prime Minister Shehbaz Sharif in a statement hailed the deal that his team had been negotiating with the IMF since June.

Sharif, on the sidelines of the United Nations General Assembly, told Pakistani media that the country had fulfilled all of the lender’s conditions, with help from China and Saudi Arabia.

“Without their support, this would not have been possible,” he said, without elaborating on what assistance Beijing and Riyadh had provided to get the deal over the line.

The Pakistani government has vowed to increase its tax intake, in line with IMF requirements, despite protests in recent months by retailers and some opposition parties over the new tax scheme and high electricity rates.

Pakistan for decades has been relying on IMF loans to meet its economic needs.

The latest economic crisis has been the most prolonged and has seen Pakistan facing its highest-ever inflation, pushing the country to the brink of a sovereign default last summer before an IMF bailout.

Inflation has since tempered, and credit ratings agency Moody’s has upgraded Pakistan’s local and foreign currency issuer and senior unsecured debt ratings to “Caa2” from “Caa3”, citing improving macroeconomic conditions and moderately better government liquidity and external positions.