The Abu Dhabi National Oil Company (ADNOC) announced signing an agreement with US-based Occidental Petroleum on February 2, which is the first onshore block to be awarded among the geographical areas that were offered for commercial bidding by ADNOC in April 2018.

The 35-year agreement was signed by Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC CEO, and Vicki Hollub, President and CEO of Occidental Petroleum.

“This concession award … will help ADNOC to unlock value and stay ahead of the long-term increase in demand for energy, oil and gas products, while further strengthening Abu Dhabi’s position as an essential energy provider to the world,” Al Jaber said.

Under the agreement, Occidental will own 100% of the block in the exploration phase and invest around $244 million on the exploration. After successfully completing the exploration phase, ADNOC will be able to hold 60% stake in the production phase of the concession.

The onshore block covers an area of 5,782 km2 located in the Al Dhafra region in UAE, which is considered the world’s seventh-largest oil producer, with about 96% of its reserves within Abu Dhabi.