Abu Dhabi National Oil Company (ADNOC) has signed 40-year agreements with Italian multinational oil firm Eni, for stakes in two of the country’s concession areas.
The deal grants Eni a 10 per cent stake in the Umm Shaif and Nasr, and a 5 per cent stake in the Lower Zakum oilfields, which are noth offshore Abu Dhabi.
The company paid a participation fee of approximately $875million (£630million) in the arrangement.
Tom Quinn, senior research analyst with Wood Mackenzie for Middle East upstream, says it shows that ADNOC is looking to balance its partners.
“Eni is very strong in North Africa, but has traditionally been under-exposed to the Middle East when compared to its peers. The company has picked up exploration blocks in Oman and Lebanon, which, being frontier, are high risk but potentially high reward.
“To balance this, the ADNOC deal provides low-risk, long-term barrels, and lays the foundation for ENI’s Middle East portfolio.
“This is the first award by ADNOC to a major (in the offshore renewal), and shows it is looking to find a balance in its strategic partners between companies from major buyers, such as Japan and India, and IOCs with technology and project delivery expertise.”
Umm Shaif and Nasr lies 83 miles off Abu Dhabi with a target production of 460,000 barrels of oil per day.
Lower Zakum is 40 miles off the coast, with a target of 450,000 barrels per day.