Adnoc awards Austria's OMV 5% stake in gas concession
The energy company joins Italy's Eni and Germany's Wintershall in the ultra-sour Ghasha concession
Abu Dhabi National Oil Company awarded Austrian energy firm OMV a five per cent stake in the Ghasha concession, the third foreign partner for the ultra-sour gas project that contains high levels of sulphur.
OMV, which is partly owned by Mubadala Investment Company, joins fellow European energy companies Italy's Eni and Germany's Wintershall as partners on the concession, Adnoc said in a statement on Wednesday. The firm will contribute five per cent to the project capital and operational development expenses. Adnoc didn't reveal the value of the deal.
“This agreement builds on, and extends, our strong partnership with OMV, who we collaborate with in key areas across the oil and gas value chain," said Adnoc group chief executive Dr Sultan Al Jaber. "They bring extensive experience in sour gas operations, in Austria and Pakistan, and, like Adnoc, have a proven record working with mature and complex reservoirs."
Adnoc, which produces much of the UAE's oil, said last month it discovered large hydrocarbon deposits equivalent to a 1 per cent increase to existing oil reserves and a 7.1 per cent addition to proven gas reserves. The company also plans to boost its investment spend to ramp out oil output capacity to 5 million barrels per day by 2030 from about the current 3 million bpd.
The Ghasha project is expected to produce over 1.5 billion cubic feet of gas per day when it comes on stream, which Adnoc said could be in the middle of the next decade. The scheme is also expected to produce over 120,000 bpd of crude and high value condensate.
The gas generated would be sufficient to power more than two million homes, Adnoc added.
The deal is the second signed between OMV and Adnoc this year.
The Austrian firm bought stakes in two blocks offshore for $1.5 billion in Abu Dhabi's Sarb and Umm Lulu fields.
Abu Dhabi's state producer also awarded French oil company Total a 40 per cent stake in the Ruwais Diyab concession last month. The agreement, which has a 40-year production term includes a six to seven-year exploration and appraisal phase.
Adnoc is also pursuing the development of its onshore Shah gas field, where it plans to increase production to 1.5 bcf. Plans are also underway to increase production capacity from the sour gas fields of Bab and Bu Hasa.
Sour gas contains high levels of sulphur that has to be stripped to produce gas suitable for consumption. Condensate is a liquid similar to oil found with gas, but fetches a higher price as it is easier to refine into by-products. Much of the gas reserves in Abu Dhabi are sour in nature.
In November, Adnoc awarded Spanish firm Tecnicas Reunidas a Dh5.1 billion contract to expand Bu Hasa, the emirate's largest onshore field.
OMV, in which Mubadala owns a 25 per cent stake, holds 36 per cent interest in chemicals firm Borealis, in which the Abu Dhabi firm has a 64 per cent interest.
Borealis and Adnoc in turn are joint investors in the UAE's biggest chemicals firm Borouge. The Abu Dhabi chemicals firm announced the beginning of construction work on its fifth polypropylene unit located at its third plant in the Ruwais facility. The scheme is set to boost polypropylene capacity by more than 25 per cent to 2.24 million tonnes per year. Polypropylene is a vital petchems product that is forms the basis of the plastics industry and sees increasing demand from consumer markets in Asia, notably India and China.
Updated: December 19, 2018 04:56 PM