Oil & Gas

The 40 percent stake in Ghasha concession now completed

ADNOC has 60pct, ENI 25pct, Wintershall 10pct and OMV 5pct

HE Dr Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO, and Dr Rainer Seele, Chairman of the OMV Executive Board and CEO, signed a concession agreement awarding OMV with a 5% interest in the Ghasha concession comprising the Ghasha mega project.

The concession is located offshore Abu Dhabi and consists of three major gas and condensate development projects Hail, Ghasha and Dalma as well as other offshore oil, gas and condensate fields including Nasr, SARB and Mubarraz. The long-term concession agreement with a term of 40 years (from November 2018) strengthens OMV’s position in Abu Dhabi and its cooperation with ADNOC.

“We are pleased to be awarded a stake in the largest sour gas and condensate fields in Abu Dhabi and to strengthen our partnership with ADNOC. We are confident that our technological expertise will contribute to value creation and profitable growth, for all partners involved. Today’s signature marks a long-term commitment and it is another important step in the successful implementation of our strategy 2025. With this agreement, we are expanding our already material position in the Middle East and are further shifting our upstream production towards gas,” Dr Rainer Seele stated.

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The-concession-was-signed-by-His-Excellency-Dr.-Sultan-Ahmed-Al-Jaber,-UAE-Minister-of-State-and-ADNOC-Group-CEO-and-Dr-Rainer-Seele,-Chairman-of-the-OMV-Executive-Board-and-CEO
The concession was signed by His Excellency Dr. Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO and Dr Rainer Seele, Chairman of the OMV Executive Board and CEO | © OMV

“This long-term strategic agreement with OMV, as well as the other Ghasha concession agreements we have concluded recently, underscores ADNOC’s commitment to maximizing value from Abu Dhabi’s substantial gas resources and to ensuring a sustainable and economic supply of gas, in line with the leadership’s directives. The combination of rising demand for gas, more advanced technology and our industry leading experience in developing sour gas fields, makes it possible for us to commercially and holistically unlock value from our vast sour gas resources. This agreement builds on, and extends, our strong partnership with OMV who we collaborate with in key areas across the oil and gas value chain. They bring extensive experience in sour gas operations, in Austria and Pakistan, and like ADNOC have a proven record working with mature and complex reservoirs. It will help ensure our investment, in the Ghasha concession, will maximize long-term returns for the benefit of ourselves, our partners and the nation,” Dr Sultan Ahmed Al Jaber, added.

OMV has a long-lasting experience in the treatment of sour gas. In 2016 OMV was awarded a four-year seismic, drilling and engineering work programme to explore and appraise oil and gas fields in the North-West Offshore Abu Dhabi area that includes the Ghasha and Hail blocks. This cooperation gave OMV in-depth knowledge and confidence in the success of the high potential Ghasha mega project.

According to ADNOC’s planning, the project will start producing around the middle of next decade. The fields are expected to produce at plateau at least 1.5 bn cubic feet per day (40mn cbm), as well as over 120 kboe/d of oil and high value condensate (gross). The greenfield development includes, beside the drilling of development wells, the construction of offshore and onshore treatment, processing and transportation facilities for natural gas, condensate, crude oil and sulphur. The final investment decision for the first fields to contribute to the production target is planned to be completed next year.

According to its 5% stake OMV will contribute to the past investments incurred by ADNOC in this concession. ADNOC’s other project partners are ENI and Wintershall, with a 25% stake and 10%, respectively, who have entered into the concession in November 2018.

 

Background

November 13, 2018: ADNOC have signed the first of a series of concession agreements with Italy’s multinational oil and gas company, ENI, awarding it a 25 percent stake in its offshore ultra-sour gas mega project. Eni will contribute 25% of the development cost of the multi-billion US dollar project.

The concession was signed by His Excellency Dr. Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO and Claudio Descalzi, CEO of ENI.

The announcement follows the Supreme Petroleum Council’s approval of ADNOC’s new gas strategy, targeted to unlock and maximize value from Abu Dhabi’s substantial available gas reserves, as the UAE moves towards gas self-sufficiency and aims to transition from a net importer of gas to a net gas exporter.

H.E. Dr Al Jaber said: “ADNOC is committed to ensuring a stable and economic gas supply to the UAE, which is a core component of our 2030 strategy. Development of our Hail, Ghasha and Dalma ultra-sour gas offshore resources, at commercial rates, will make a significant contribution towards delivering that strategic imperative and bringing forward the day when the UAE will not only be self-sufficient in gas but also transitions to net exporter of gas.”

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The concession, which has a term of 40 years, was signed by His Excellency Dr. Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO and Claudio Descalzi, CEO of ENI.
The concession was signed by His Excellency Dr. Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO and Claudio Descalzi, CEO of ENI. | © ADNOC

“In combination with ADNOC’s leading experience in ultra-sour gas, Eni’s field development experience supports the accelerated delivery of gas from the Hail, Ghasha and Dalma fields. At the same time, it will enable the further optimization of costs and ensure we extract the maximum value from our gas resources, as we continue to partner with those who share our values and contribute to our growth strategy.”

Claudio Descalzi, CEO of ENI, said: “We are pursuing a strategy of growing in the Middle East and today’s signature is further confirmation of our willingness to root our presence in Abu Dhabi, following the agreements signed last March, with ADNOC. Today’s agreement is further proof of the strong alliance with such an important partner as ADNOC and of the proof of confidence in our globally recognized upstream model, based on the integration of exploration and development. This has allowed us to achieve extraordinary results over the last years in exploration, as well as in developing our discoveries in a record time-to-market.”

The Hail, Ghasha and Dalma project will apply state-of-the-art smart technologies. It will leverage the latest digital innovations to ensure remote access to all key activities across the project’s natural and artificial islands, platforms and well-head towers. All the project’s remote facilities will be operated from a single control center, in Al Manayif that will be able tom respond immediately whenever changes or interventions are needed. The utilization of smart technologies will enable ADNOC to unlock more value from the gas reserves and reduce human exposure to the operations, as well protecting the environment and investment alike.

 

November 26, 2018: The Abu Dhabi Government and the Abu Dhabi National Oil Company (ADNOC) have added Wintershall Holding GmbH to the Ghasha ultra-sour gas mega project with a 10 per cent stake. The Ghasha Concession consists of the Hail, Ghasha, Dalma and other offshore sour gas fields including Nasr, SARB and Mubarraz. Wintershall will contribute 10% of the project capital and operational development expenses.

The concession agreement was signed by His Excellency Dr. Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO, and Mario Mehren, CEO of Wintershall.

H.E. Dr Al Jaber said: “Development of the Ghasha concession area is a strategic priority for ADNOC. The gas, extracted from the concession area, at commercial rates, will make a significant contribution to fulfilling our commitment to ensuring a sustainable and economic gas supply, and achieving our objective of gas self-sufficiency for the UAE.

“In common with ADNOC, Wintershall has extensive experience of appraising and developing ultra-sour gas resources in technically complex fields. It is a partnership in which each company will benefit from the experience of the other as, together, we optimize costs and ensure we extract the maximum value from all the available gas resources. It builds on our long experience of sour gas production and strengthens our ambition to establish a center of excellence, in Abu Dhabi, for sour gas development.”

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The-concession-agreement-was-signed-by-His-Excellency-Dr.-Sultan-Ahmed-Al-Jaber,-UAE-Minister-of-State-and-ADNOC-Group-CEO,-and-Mario-Mehren,-CEO-of-Wintershall.
The concession agreement was signed by His Excellency Dr. Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO, and Mario Mehren, CEO of Wintershall. | © ADNOC

 

Mario Mehren, CEO of Wintershall, said: “We are delighted to be partners in this project, supporting ADNOC’s 2030 smart growth strategy. The project also fits excellently with our strategy. We have been working since 2010 on strengthening the Middle East region by investing here and developing it into another growth region for Wintershall. And, we achieved that goal today by signing the contract. We are proud that ADNOC is placing its trust in Wintershall as a partner. We want to establish a strong and long-term cooperation in Abu Dhabi. Together with ADNOC, we will build up substantial production.
“Natural gas production in Abu Dhabi complements our existing portfolio in an ideal way. We have decades of experience to offer in safely developing sour gas fields. We will contribute our technical know-how, strength in implementing projects and cost-effectiveness, in Abu Dhabi, in the coming decades.

“Wintershall is particularly qualified for the offshore operations in the Ghasha Concession. We are experts in drilling technically demanding wells and developing fields efficiently. And we know precisely what counts in ecologically sensitive areas,” Mehren added.

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