MEOG: ADNOC and Petronas sign unconventional deal

Abu Dhabi National Oil Co. (ADNOC) this week signed a deal with Petronas that awards the Malaysian firm the first concession for unconventional oil development in the Middle East.

Under the terms of the agreement, Petronas was granted 100% operatorship of the six-year exploration phase of the Unconventional Onshore Block 1 asset which covers more than 2,000 square km in the western Al Dhafra region of Abu Dhabi.

The deal was signed by HE Dr. Sultan Al Jaber, UAE Minister of Industry and Advanced Technology and ADNOC managing director and CEO, and Datuk Tengku Taufik, president and CEO of Petronas, during a visit by Malaysian King Abdullah’s visit to the UAE.

Al Jaber said: “ADNOC will continue to responsibly unlock value from Abu Dhabi’s vast hydrocarbon resources in a reliable and sustainable manner.” He added: “We have driven the de-risking of Abu Dhabi’s unconventional oil resources and look forward to building on this with Petronas to realise the full potential of Unconventional Onshore Block 1.”

Following a successful appraisal phase, the parties’ have the option to form a 30-year production concession, with ADNOC having the customary option to take a stake in this phase, on this occasion 50%.