The UAE is looking to open its upstream sector to more private companies, including newcomers at marginal fields, according to chief executive of Abu Dhabi Marine Operating Company (ADMA-OPCO).
“The principle of the tender is to be more open for partners… In the last three years there has been a change towards more openness, some additional partners,” Ali Al Jarwan told reporters, according to a Reuters report.
“There’s consideration to have newcomers in these marginal fields,” Jarwan said when asked if Korean and Chinese companies could be awarded some field rights, reports Reuters.
Abu Dhabi is preparing for the renewal of key concessions from 2014, including the onshore fields currently managed by the ADCO consortium.
ADCO is comprised of ADNOC, Exxon Mobil, Shell, Total, BP and Partex Oil & Gas. The consortium has a long-standing plan to invest $60 billion at its six fields, which has been held up as over concerns over technology sharing and growing uncertainty as end of the current contract approaches.
“The most probable scenario is continuation of IOCs’ partnership with ADNOC, with a minimum 60 percent ADNOC holding and either one or more partner being from the West,” Mohammed Sahoo Al Suwaidi, chief executive of Abu Dhabi Gas Industries, told Reuters.
Al Suwaidi also mentioned South Korean and Chinese companies may get stakes.
Suwaidi’s news will be welcomed by the existing ADNOC majors, who would likely be content with an increased per-barrel fee structure and assurances over intellectual property, particularly if new entrants will be added.
A full-blown field auction may see new entrants, some of which specialise in the kinds of field recovery techniques Abu Dhabi requires, lowball supermajor bids.
ADNOC is working on a tendering process for ADCO’s new concession with management consultants McKinsey.
The NOC has already sent pre-approval letters to its existing supermajor partners, and potential new entrants including Statoil, Maersk Oil and Occidental. Enhanced Oil Recovery expertise is thought to be a key consideration.
ADCO is targeting a production hike from 1.4 million barrels a day to 1.8 million bpd, as part of Abu Dhabi’s national plan to raise production capacity to 3.5 million bpd.
