The six new major licensing blocks announced by Abu Dhabi National Oil Company (Adnoc) on Tuesday contain “multi-billions of barrels of oils and multi-trillions of cubic feet of gas” according to Abdul Munim Saif Al Kindy, director of Adnoc’s Upstream Directorate.
While declining to be more specific, he did say that full data would be presented to interested parties following a series of roadshows beginning in Abu Dhabi on April 23. The roadshow will continue in Europe, the US and Asia in May.
“Let me assure you that we have an extensive database on what’s going on in exploration in the world,” he said. “We know exactly how much this basin holds. We are very confident of the developed detail that we have already invested in — investment in seismic, core samples, in a big list of wells.”
Successful bidders for exploration rights would also have to opportunity to develop and produce from their finds, Dr Sultan Ahmad Al Jaber, UAE Minister of State and CEO of Adnoc, said. He added that Adnoc would gain 60 per cent of oil produced, as with its existing concessions.
Al Kindy said, “As far as rights are concerned, they are preserved for whatever time it will take for the oil to be economically extracted. We’re talking about 20 years to 40 years, but there are terms and conditions that will be specifically notified to the interested parties.”
Bids would be accepted from both state-supported and private companies, Al Jaber said. The closing date for bids will be in October, with bid winners announced before the end of this year.
Describing the block licensing strategy as a “significant milestone,” Al Jaber said, “For over 35 years our leadership has entrusted Adnoc with the task of maximising the value of Abu Dhabi’s oil and gas reserves. As a result, the economy of Abu Dhabi and the UAE has grown, and grown substantially.”
He said the new licences were part of a new approach Adnoc had been pursuing for the last two years to meet its 2030 smart growth strategy, requiring a “more profitable upstream, a more valuable downstream and a more sustainable economic supply for us.”
London: Oil broke above $70 a barrel on Tuesday, extending strong gains from the previous day, as investors grew more optimistic that a trade dispute between the United States and China may be resolved without greater damage to the global economy.
Brent crude futures were up $1.39 at $70.04 a barrel by 1131 GMT, while West Texas Intermediate (WTI) crude futures rose $1.23 to $64.65 a barrel.
The oil price has risen by nearly 4.5 per cent in the last two trading days.
President Xi Jinping on Tuesday promised to open China’s economy further and lower import tariffs, in a speech that struck a conciliatory tone on the trade tensions between China and the United States.
Equities and industrial commodities rose, while perceived safe-havens such as gold and US Treasuries came under pressure, reflecting confidence among traders and investors that a trade war is increasingly unlikely.