Abu Dhabi’s oil leadership has a short list of contenders for the remaining stake in its flagship onshore oil concession after BP acquired a 10% stake. Top contenders are Chinese state-controlled energy companies, including China National Petroleum Coorporation (CNPC), The National reported.
While, privately-run CEFC China Energy is in advanced talks with state-owned Abu Dhabi National Oil Co. (ADNOC) to try to acquire 10% of the Abu Dhabi Company for Onshore Petroleum Operations (ADCO), which operates onshore oil concessions with total resources of between 20b to 30b barrels of oil equivalent, according to Reuters.
It has long been expected that ADNOC would bring in at least one Chinese partner in recognition of the country’s growing importance as a customer. China ranked fourth as a source of the United Arab Emirates (UAE) exports in 2014 at $14b. Yet, China’s numbers would be boosted further by its exports to Singapore, where PetroChina is operator of one of the region’s largest refineries. Furthermore, China and the UAE have been making efforts on many fronts to deepen their trading relationship, including a previous deal for China to double its Abu Dhabi crude imports.
The ADCO concession, including the Bab, Bu Hasa, Shah and Asab fields, produces 1.6mb/d of oil, with output expected to reach 1.8mb/d from 2017.The negotiating process for stakes in ADCO, which accounts for slightly more than half of Abu Dhabi’s 3.1mb/d of output, has dragged on for three years since the expiry of the old concession, as the emirate’s Supreme Petroleum Council, advised by ADNOC, has evaluated proposals.