Adnoc ironing out oil trade wrinkle with Qatar Petroleum
The Abu Dhabi National Oil Company (Adnoc) said it is ironing out a wrinkle in an oil trade with Qatar Petroleum, after cargoes had to be diverted from Adnoc's refinery.
The Abu Dhabi state oil company said two cargoes of condensate – a by-product of natural gas production – totalling 1 million barrels, which had been bound for Adnoc's Ruwais refinery in the Western Region, had to be diverted because of the closure of UAE ports to Qatari vessels under the sanctions imposed by a Saudi Arabia-led alliance on June 5.
The cargoes were the last under a year-long contract between Adnoc and Qatar Petroleum and there are normal market procedures for dealing with such disruptions, whereby the seller can find another buyer and the original buyer makes up the difference. Adnoc replaced its supply with other spot cargoes from the market.
"Adnoc has made arrangements to handle the two remaining cargoes in question, and has communicated to Qatar Petroleum that no state of force majeure exists," the company said.
The broader dispute between Doha and its neighbours – over funding of terrorist organisations and other agitations – has hit various economic sectors in Qatar. But the two sides have been careful to keep disruption to hydrocarbon trade to a minimum, including keeping the vital Dolphin natural gas pipeline from Qatar to the UAE – and on to Oman – flowing.
Apart from the vital nature of hydrocarbons to the region's economies, the fact that there are a wide number of international oil companies involved in many of the projects is a factor.
Dolphin is 51 per cent owned by Mubadala Investment Company, Abu Dhabi's strategic development fund, with Total and Occidental Petroleum owning 24.5 per cent each.
Condensate is lighter – and more valuable – than crude oil and the cargoes in question would have been worth about US$60 million.