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    CNPC Joins Abu Dhabi Offshore Concessions

Summary

Petrochina has been awarded stakes in two Abu Dhabi offshore concession areas by state-owned Adnoc in the latest $1bn-topping deal.

by: Mark Smedley

Posted in:

Natural Gas and LNG News, Middle East, Corporate, Exploration & Production, News By Country, China, United Arab Emirates

CNPC Joins Abu Dhabi Offshore Concessions

China National Petroleum Corporation (CNPC) has been awarded stakes in two of Abu Dhabi’s offshore concession areas following the signing of agreements with state-owned Abu Dhabi National Oil Company (Adnoc) on March 21, the latter has said.

Under the terms of the agreements, CNPC's majority-owned PetroChina has been granted a 10% interest in the Umm Shaif and Nasr concession and a 10% interest in the Lower Zakum concession in return for an entry payment of $1.175bn.

PetroChina contributed a participation fee of dinar 2.1bn ($575mn) to enter the Umm Shaif/Nasr concession and a fee of dinar 2.2bn ($600mn) to enter the Lower Zakum concession. Both concessions will be operated by Adnoc Offshore, on behalf of all concession partners. The agreements have a term of 40 years and are backdated to March 9, 2018.

They follow similar big-ticket concession deals signed by Adnoc in recent days with Total for $1.45bn (20% of Umm Shaif/Nasr, 5% of Lower Zakum) and with Eni for $875mn (10% Umm Shaif/Nasr, 5% Lower Zakum). Total earlier this week said that the Umm Shaif oilfield also contains a giant gas-cap, which is to be developed in the scope of the concession with a gas production target of 500mn ft3/d (5.2bn m3/yr). 

Adnoc said that CNPC joins Eni and Total as participants in Umm Shaif/Nasr, while an ONGC Videsh-led consortium 10%, Japan's Inpex 10%, Eni 5% and Total 5% are also participants in Lower Zakum. Adnoc retains 60% majority operating stakes in both concessions.

In February 2017, CNPC - which Adnoc describes as the world's third largest oil company - was awarded an 8% interest in Abu Dhabi’s onshore concession, operated by Adnoc Onshore. It also has a 40% stake in the Al Yasat concession with ADNOC.

Update April 5, 4.30pm British Summer Time relating to Adnoc oilfields: Austria's OMV said April 5 that it had been agreed with Abu Dhabi's state Adnoc that OMV will acquire a 20% interest in the concession for the offshore oil fields Satah Al Razboot (with the satellite fields Bin Nasher and Al Bateel) and Umm Lulu, plus associated infrastructure, for a purchase price of $1.5bn. Update Apr.30: Final signing by OMV occurred April 29 2018

 

The March 21 agreements were signed, in Abu Dhabi, by CNPC chairman Wang Yilin (left) and Adnoc CEO Sultan Ahmed Al Jaber (Photo credit: Adnoc)