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ADNOC, US Firm Sign USD 244mln Deal

By  AOG Staff Sunday, 03 February 2019 17:51
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Abu Dhabi National Oil Co. (ADNOC) said it awarded an onshore block, known as Onshore Block 3 to US-based oil and gas exploration and production company Occidental Petroleum.

Photo: The concession agreement, which has a term of 35 years, was signed by His Excellency Dr. Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO, and Vicki Hollub, President and CEO of Occidental.
Photo: The concession agreement, which has a term of 35 years, was signed by His Excellency Dr. Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO, and Vicki Hollub, President and CEO of Occidental.

The award has been endorsed by Abu Dhabi’s Supreme Petroleum Council (SPC).

Occidental will have a 35-year concession and invest $244m during the exploration phase of the block, which covers an area of 5,782 square kilometres in al-Dhafrah region in the emirate of Abu Dhabi.

Onshore Block 3 covers an area of 5,782 km2 located in the Al Dhafra region. Existing 3D seismic data already covers a large part of the Block which, combined with its proximity to the Shah, Asab, Haliba and Sahl fields, suggests the concession area has very promising potential.

Following the recent award of Abu Dhabi’s two offshore blocks, Onshore Block 3 is the first onshore block to be awarded among the geographical areas that were offered for commercial bidding by ADNOC in April 2018. Abu Dhabi’s new block licensing strategy represents a major advance in how the Emirate accelerates the exploration and development of untapped resources to replenish its rich reserves base and drives new commercial opportunities.

Under the terms of the agreement, Occidental will hold a 100 percent stake in the exploration phase, investing AED 893 million (US $244 million), including a participation fee, to explore for oil and gas in Onshore Block 3.

Upon successful exploration – and having established the commerciality of the discovered resources – Occidental will be granted the opportunity to develop and produce any discoveries. ADNOC has the option to hold a 60 percent stake in the production phase of the concession.

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