An offshore oil rig. Image Credit: GN Archive

Abu Dhabi:  The UAE plans to increase its oil output capacity to 3.5 million barrels per day (bpd) by 2018 from the 2.7 million bpd it currently produces, an independent report sponsored by Abu Dhabi Department of Economic Development released yesterday said.

The report estimated Abu Dhabi's proven oil reserves at 98.2 billion barrels, slightly higher than the Organisation of the Petroleum Exporting Countries (Opec) figures of 97.8 billion barrels earlier this year.

"The global economic crisis has provided new impetus to achieving this goal as lower construction prices have cut the cost of expanding Abu Dhabi's oil fields by billions of dollars," said The Oil and Gas Year's Abu Dhabi 2010, produced by Wildcat Publishing Inc in partnership with the Abu Dhabi Department of Economic Development and Abu Dhabi National Oil Co (Adnoc) and its Group of Companies.

To take advantage of this, Adnoc invested heavily in production expansion in 2009 and 2010.

"In 2009, Adnoc had 30 operational rigs and drilled some 200 wells. In 2010, it expects to add another four to five rigs to the current fleet and drill 300 more wells [75 per cent oil and 25 per cent gas]," according the report.

In June, the IEA predicted that the UAE's production capacity would reach 3.1 million bpd in 2015.

The nation's actual oil output, however, is likely to remain at no more than 2.3 million barrels per day for the time being, in compliance with the Opec quota that has been in place since the end of 2008.

"Increasing [oil output] capacity does not necessarily mean increasing production," said Mohammad Habroush Al Suwaidi, a member of the Supreme Petroleum Council and adviser to President His Highness Shaikh Khalifa Bin Zayed Al Nahyan.

"As an oil-producing country and a member of Opec, we have a responsibility to consumers as well as to other producers. It is our responsibility to assure the wider community that there will be no shortage of oil in the coming years. We want to increase production but only within the limits set by Opec," Al Suwaidi was quoted by book.

He said the UAE was among the least affected countries by the global financial crisis. ‘There have been no delays or cancellations at all as far as oil and gas projects are concerned.

Nasser Ahmad Al Suwaidi, chairman of the Department of Economic Development, said Abu Dhabi is also continuing exploration in the region and beyond through Mubadala Oil and Gas, the International Petroleum Investment Company and Taqa, and will increase the refinery capacity of the emirate through development of existing capacity on Ruwais and Greenfield projects in Fujairah.

Transportation

"In addition, we will improve transportation activities through the supplementation of Abu Dhabi's fleet of tankers and the creation of direct access to the Indian Ocean at Fujairah through the construction of the inter-emirate Abu Dhabi Crude oil Pipeline, which will have a capacity of 1.5 million barrels per day," Al Suwaidi told the report.

The report puts Abu Dhabi's investments in oil and gas projects at $30 billion (Dh110.1 billion) and UAE's spending on oil and gas engineering, procurement and construction between October last year and this month at $21 billion.

Mubadala checks on BP assets

Abu Dhabi : Mubadala Development Co will look at BP assets going on sale as the UK oil major struggles with the fallout from the Gulf of Mexico oil spill disaster but is not in direct talks, a senior official said yesterday.

"Like most oil companies that are expanding, we will be looking at what's available," David Douglas, senior vice-president of finance and corporate support at Mubadala Oil and Gas said. Asked whether Mubadala was in talks with BP, Douglas said: "not really directly". Mubadala invests strategically on behalf of the Abu Dhabi government.

-Zawya Dow Jones