Shinichi Kihara, (left), Director, Middle East & Africa division, in Japan’s Ministry of Economy, Trade and Industry, and Masato Sasaki, director of oil and natural gas division in Japan’s ministry of economy, trade and industry, during their briefing in Abu Dhabi. Image Credit: Abdul Rahman/Gulf News

Abu Dhabi: Japanese companies are in the last stage of negotiations for the renewal of Abu Dhabi’s offshore concession expiring next year, a top official from the country’s ministry of economy, trade and industry said in Abu Dhabi on Monday.

“Negotiations are in a very last stage for offshore concessions. Abu Dhabi side is seriously in consideration of offers from Japanese side. Sultan Al Jaber showed us positive signs on our long-term cooperation in those areas,” said Masato Sasaki, director of oil and natural gas division in the ministry, while speaking to reporters.

He said two or three companies are involved in negotiations but did not specify the names of companies.

Currently Japan Oil Development Company (Jodco) holds a 12 per cent stake in the offshore oil concessions operated by Abu Dhabi Marine Operating Company (Adma Opco) that expires in March 2018. Other stakeholders include BP and French oil giant Total.

Adonc on behalf of the Abu Dhabi government will hold 60 per cent stake in the concession while the remaining 40 per cent will be given to different selected firms.

The existing concession area operated by Adma-Opco produces around 700,000 barrels of oil per day and is expected to have production capacity of about one million barrels per day by 2021.

“We hope that Japanese companies who are involved in the negotiations are successful. We are waiting for good news.”

Japan also initiated a strategic dialogue with Andoc for cooperation in mid-steam and downstream energy sectors.

“We want to explore third market business for new opportunities. The details will be unveiled later. So far our focus has been in upstream, we want to widen our relationship with Adnoc.”

Adnoc and Japan share a long history of energy cooperation. Adnoc has supplied Japan with oil, gas and refined products since its foundation in 1971. It is Japan’s second largest supplier of crude oil and a major supplier of gas and refined products.

In 2016, Adnoc’s crude oil exports to Japan averaged 513,000 barrels per day, which represent around 25 per cent of Japan’s crude oil imports, Adnoc said in a statement on Sunday.

In January, Japan’s Ministry of economy, trade and industry extended its agreement with Adnoc to store crude oil at the Kiire oil terminal in Kagoshima city for two years until 2019.

Under the deal Adnoc can store up to 6.29 million barrels of crude oil providing Adnoc with greater access to Asian markets while giving Japan priority access to reserves in time of tight supply.

Japanese companies are exploring opportunities with Mubadala in various areas including renewables, he added.

Inpex, the parent company of Jodco also has a 5 per cent share of Adco concession for developing onshore oilfields.