The UAE state-owned Abu Dhabi National Oil Company (ADNOC) has announced the signing of a historic exploration concession agreement, granting the exploration rights for Abu Dhabi’s Offshore Block 5 oil field to a consortium of four Pakistani companies.
The companies include Pakistan Petroleum Limited (PPL), Mari Petroleum Company Limited (MPCL), Oil and Gas Development Company Limited (OGDCL), and Government Holdings Private Limited (GHPL) in Abu Dhabi’s second competitive block bid round.
The exploration concession agreement has been signed by Dr. Sultan bin Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology and Managing Director and Group CEO of ADNOC, and Mr. Moin Raza Khan, Managing Director and CEO of PPL. This is the first time Pakistani companies have invested in and explored oil and gas in an Abu Dhabi concession as well as the first time ADNOC has partnered with Pakistani energy companies.
The agreement builds on the UAE and Pakistan’s long-term bilateral relationship and highlights ADNOC’s expanded approach to strategic alliances, including those that can provide access to key growth markets for the company’s crude oil and products.
“This historic exploration concession award marks a new chapter of energy cooperation in the 50-year old UAE-Pakistan relationship. It represents an important platform upon which we can drive win-win opportunities to support Pakistan’s energy security and further strengthen the strategic and economic ties between two countries.”
According to the terms of the agreement, the consortium will have a 100 percent stake in the exploration phase, investing up to $304.7 million in exploration and appraisal drilling, including a participation fee, to explore for and appraise recoverable unconventional oil and gas resources in the block, which covers an offshore area of 6,223 square kilometers and is located 100 kilometers northeast of Abu Dhabi city.
Mr. Khan said, “We are particularly excited that this consortium comprises the ‘big four’ national exploration and production companies that are fully geared to support ADNOC and the Emirate of Abu Dhabi in reinforcing its leading position in the global energy sector.”
During the exploration phase, the consortium will leverage and contribute financially and technically to ADNOC’s mega seismic survey, which captures 3D seismic data within the block area. The data collected across a large portion of the block, together with the concession area’s proximity to existing oil and gas fields, suggests that the concession area offers great potential.
PPL owns and operates 15 producing fields in Pakistan, accounting for more than 20 percent of the country’s total natural gas supplies. PPL had 1,793.5 billion cubic feet (bcf) of natural gas, 13.3 million barrels (mmbbl) of oil/ NGL/ condensate, and 543.1 thousand tons (Ktons) of LPG proved recoverable reserves as of June 2020.