Abu Dhabi’s 75-year oil-production agreement is expiring, leaving the largest U.S. and European oil companies without direct stakes in the onshore crude deposits of OPEC’s fourth-biggest supplier.
Abu Dhabi National Oil Co. will continue to produce and market oil from the fields through an operating unit, ending its partnership with BP Plc (BP/), Royal Dutch Shell Plc (RDSA), Exxon Mobil Corp. (XOM) and Total SA (FP), state-run Emirates News Agency, or WAM, reported today.
The international companies are among those bidding for new production agreements that would allow them to keep pumping oil in the Persian Gulf emirate, leaving their future roles in the sheikhdom unclear. Adnoc has invited additional companies from Europe and Asia to compete for the oil-development projects. Abdulla Nasser al-Suwaidi, Adnoc’s director general, said in November the bidding process could take until January 2015.
Abu Dhabi, capital of the United Arab Emirates, has produced at its main onshore oil fields under concession agreements with BP, Shell, Exxon, Total and Portugal’s Partex Oil & Gas, or their predecessor companies, since Jan. 11, 1939. Adnoc became a partner in the 1970s, joining with the international companies to form Abu Dhabi Co. for Onshore Oil Operations, or ADCO. The partnership was responsible for extracting 1.5 million barrels a day of Murban grade crude.
ADCO will continue to operate the fields on behalf of Adnoc in the absence of the international partners, al-Suwaidi said at a ceremony marking the end of the concessions, according to the WAM statement. Adnoc has held a 60 percent stake in ADCO, with the five foreign partners owning the remaining 40 percent. Partex was not invited to bid for a new concession.
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