Dubai: Pakistani energy companies won big in Abu Dhabi, with four of them securing an offshore exploration contract from UAE blue-chip ADNOC. The contract is for the Offshore Block 5 and the consortium features Pakistan Petroleum ltd. (PPL), Mari Petroleum Company ltd. (MPCL), Oil and Gas Development Company ltd. (OGDCL), and Government Holdings (Private) ltd (GHPL).
This is Abu Dhabi’s second competitive block bid round.
The consortium will have the rights to a production concession to develop and produce any future discoveries. ADNOC has the option to hold 60 per cent stake in the production phase of the concession. The term of the production phase is for 35 years from start of exploration.
“This historic exploration concession award marks a new chapter of energy cooperation in the 50-year old UAE-Pakistan relationship,” said Dr. Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology and Managing Director and Group CEO of ADNOC. “It represents an important platform upon which we can drive win-win opportunities to support Pakistan’s energy security and further strengthen the strategic and economic ties between our two countries.”
We are particularly excited that this consortium comprises the ‘big four’ national exploration and production companies that are fully geared to support ADNOC and the Emirate of Abu Dhabi in reinforcing its leading position in the global energy sector.
Under the terms of the agreement, the Pakistan consortium will hold a 100 per cent stake in the exploration phase, investing up to Dh1.12 billion towards exploration and appraisal drilling and including a participation fee. This will be to explore for and appraise oil and gas opportunities in the block that covers an offshore area of 6,223 square kilometers and located 100 kilometers northeast of Abu Dhabi city.
ADNOC had launched Abu Dhabi’s second competitive block bid round in 2019, offering major onshore and offshore blocks. The award of Offshore Block 5 saw “very competitive proposals” submitted for the geographical areas offered.
Following ADNOC’s recent discovery of 22 billion stock tank barrels (STB) of recoverable unconventional oil resources and 160 trillion standard cubic feet (SCF) of recoverable unconventional gas resources, “it was decided not to award an exploration license for Onshore Block 2,” the company said. “ADNOC intends to engage with potential partners for unconventional resource licensing opportunities around this geographical area. This area contains some of the unconventional resources discovered that have production potential ranking alongside the most prolific North American shale oil plays.”
“The consortium was selected as part of Abu Dhabi’s block bid round where we have once again reinforced our approach to strategic partnerships that contribute the right combination of market access, capital, best-in-class expertise or advanced technology,” the ADNOC chief said. “We are very optimistic about the potential to unlock significant value with all our partners in this second competitive block bid round as we continue to accelerate the exploration and development of Abu Dhabi’s untapped resources.”
Based on existing data from detailed petroleum system studies, seismic surveys, exploration, and appraisal wells data, estimates suggest the blocks in this second bid round hold multiple billion barrels of oil and multiple trillion cubic feet of natural gas.
