An Abu Dhabi National Oil Company (Adnoc) offshore project. Picture used for illustrative purposes only. Image Credit: Adnoc

Abu Dhabi: Abu Dhabi National Oil Company (Adnoc) awarded Italy’s multinational oil and gas company Eni stakes in two of Abu Dhabi’s offshore concession areas with 10 per cent interest in the Umm Shaif and Nasr concession and a 5 per cent interest in the Lower Zakum concession.

This is the first time an Italian energy company has been given concession rights in Abu Dhabi’s oil and gas sector.

Eni contributed a participation fee of Dh2.1 billion ($575 million) to enter the Umm Shaif and Nasr concession and a fee of Dh1.1 billion ($300 million) to enter the Lower Zakum concession, Adnoc said in a statement on Sunday.

Both concessions will be operated by Adnoc Offshore, a subsidiary of Adnoc, on behalf of all concession partners.

The agreements, which have a term of 40 years, backdated to March 9, 2018, were signed by Dr Sultan Ahmad Al Jaber, Adnoc Group Chief Executive Officer, and Claudio Descalzi, CEO of Eni in the presence of His Highness Sheikh Mohammad Bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, and Deputy Supreme Commander of the UAE Armed Forces, and Paolo Gentiloni, Prime Minister of Italy.

“Our partnership with Eni, and other concession partners, will enable us to accelerate our growth, increase revenue and improve integration across the upstream value chain, as part of our ongoing transformation and build on the foundations that have been laid to deliver a more profitable upstream business,” said Dr Al Jaber.

Greater market access

The Umm Shaif and Nasr, and Lower Zakum concessions, along with the SARB and Umm Lulu concession areas, have been created from the former ADMA offshore concession, with the aim of maximising commercial value, broadening the partner base, expanding technical expertise, and enabling greater market access.

Adnoc is finalising opportunities, with potential partners, for the remaining 15 per cent of the available 40 per cent stake in the Lower Zakum concession, and for the remaining 30 per cent stake in the Umm Shaif and Nasr concession. Adnoc retains a 60 per cent majority share in both concessions.

Eni joins an Indian consortium, led by ONGC Videsh, and Japan’s Inpex as stakeholders in the Lower Zakum concession. In 2017, the company achieved a daily average crude production of 1.8 million bpd. It is active in 73 countries including some in Africa, Gulf of Mexico, Indonesia, Australia and others.