Italian oil firm, Eni, has signed, in Abu Dhabi, United Arab Emirates (UAE), two concession agreements with Abu Dhabi National Oil Company (ADNOC) for the acquisition of five per cent stake in the Lower Zakum offshore oil field and 10 per cent stake in the oil, condensate and gas offshore fields of Umm Shaif and Nasr, for a participation fee of about $875 million for 40 years.
Eni’s Nigerian subsidiary Nigerian Agip Oil Company said the signing was attended by Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, and Deputy Supreme Commander of the UAE Armed Forces, the Italian Prime Minister, Paolo Gentiloni, Dr Sultan Ahmed Al Jaber, Abu Dhabi National Oil Company (ADNOC) Group Chief Executive Officer, and Eni’s Chief Executive Officer, Claudio Descalzi.
The agreements represent a strategic move for Eni to gain access to a country with hydrocarbon reserves among the largest in the world.
Lower Zakum is about 65 kilometres off the coast of Abu Dhabi. The discovery dates back to 1963 and production began in 1967. It has a target production of 450,000 barrels of oil daily. Umm Shaif and Nasr are located about 135 kilometres from the coast of Abu Dhabi and have a target production of 460,000 barrels of oil daily.
Eni’s CEO Claudio Descalzi said: “I’m very pleased about this agreement creating a larger presence for Eni in Middle East, in line with our expansion strategy, and creating a strong alliance with ADNOC and Abu Dhabi. The stakes in the two concessions give access to giant fields with huge potential and Eni is willing to contribute its best technology to maximise the future production.”
Dr Al Jaber said: “These agreements underline the international market’s confidence in ADNOC’s long-term growth plans and the UAE’s stable and reliable investment environment. They also broaden and diversify our partnership base, while contributing experience, technology, capital and market access.
“Our partnership with Eni, and other concession partners, will enable us to accelerate our growth, increase revenue and improve integration across the upstream value chain, as part of our ongoing transformation and build on the foundations that have been laid to deliver a more profitable upstream business. With these agreements ADNOC continues to leverage its 46-year legacy of successful energy partnerships, in support of its 2030 strategy.”
In both concessions, ADNOC owns a 60 per cent stake while the operator is ADNOC Offshore.