PetroChina pays $1.2B for offshore acreage in UAE
UAE’s national oil company ADNOC has awarded the Chinese oil company PetroChina stakes in two offshore concessions in the UAE.
PetroChina paid around $575 million for a ten percent stake in the Umm Shaif and Nassr concession, and a fee of $600 million for a ten percent ownership in the Lower Zakum concession.
The agreements have a term of 40 years and are backdated to March 9, 2018.
The news follows last week’s announcement that France’s Total had acquired a 20% interest in the Umm Shaif and Nasr concession and a 5% interest in the Lower Zakum concession for a total of $1.4 billion.
The Umm Shaif and Nasr concession and the Lower Zakum concession have been created from the former ADMA offshore concession.
It has been divided into three separate concession areas with the aim of maximizing commercial value, broadening the partner base, expanding technical expertise, and enabling greater market access.
According to ADNOC, the Umm Shaif field’s Arab reservoir is characterized by a huge gas cap – one of the largest in the region – with reserves rich in condensates. Based on ADNOC’s development and initial piloting activities in the gas cap, the concession partners will further pursue the technical and economic evaluation of the development.
The gas cap overlays an oil rim which, in combination with Nasr, has a crude production capacity of 460,000 bpd. ADNOC plans to process 500 million standard cubic feet of gas per day from Umm Shaif’s gas cap to help meet Abu Dhabi’s growing domestic demand for energy and reduce reliance on imported gas. The condensates, from the gas cap, will be refined to extract higher value products that can be used in a variety of petrochemical applications.
In the Umm Shaif and Nasr concession, PetroChina will join Total and Eni, which was recently awarded a 10% stake.
In the Lower Zakum concession,PetroChina joins an Indian consortium, led by ONGC Videsh, Japan’s INPEX, as well as Eni, and Total as stakeholders.