Eni, Thailand's PTTEP Win Oil Exploration Rights in Abu Dhabi
(Bloomberg) -- Eni SpA and Thailand’s PTT Exploration and Production Pcl secured rights to explore for oil and natural gas in Abu Dhabi, committing to invest at least $230 million to assess the offshore fields.
The concession will be operated by Eni, and will be fully-owned by the Italian company and the government-owned Thai producer. Abu Dhabi National Oil Co. will have the option of retaining 60 percent of the fields once they reach the production phase.
“We are engaging with partners who actually put skin in the game,” Sultan Ahmed Al Jaber, Chief Executive Officer of government-owned Adnoc, said at a conference in Abu Dhabi.
Middle Eastern energy producers are among the industry’s most prolific investors in future output capacity. As global oil majors have limited their spending amid volatile swings in crude prices, state producers are investing billions of dollars to expand output and find new hydrocarbon deposits.
The United Arab Emirates, of which Abu Dhabi is the capital, is among producers that agreed to cut oil output this year to bolster prices. The Organization of Petroleum Exporting Countries and partners including Russia pledged to start cutting 1.2 million barrels of daily production this month to stem a surplus and stabilize the crude market.
Despite paring its current production, the U.A.E. is working to build greater future capacity. Adnoc in April announced its first competitive tender for partners to explore for and develop oil and gas, offering four blocks onshore and two that are offshore. The Eni concession was the first to be awarded from that package.
Eni has made offshore discoveries from the Americas to Africa and the Mediterranean. The Rome-based company has been active in the Persian Gulf to build on its successful discoveries. It won rights to develop crude and gas deposits in Abu Dhabi last year, and it wants to partner in Qatar’s liquefied natural gas projects.
Abu Dhabi holds about 6 percent of global crude reserves and pumps most of the U.A.E.’s oil. Adnoc, which has worked with international companies for more than four decades, received 39 bids for new exploration projects, Al Jaber said in an interview in November. Adnoc aims to boost oil production capacity to 5 million barrels a day by 2030 from more than 3 million now.
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