Abu Dhabi National Oil Company (ADNOC) and Malaysian oil and gas company Petronas have agreed to explore opportunities across the entire oil and gas value chain.
The companies said in a joint statement that they intend to collaborate in the exploration, development, and production of conventional and unconventional hydrocarbons in Abu Dhabi.
Dr. Sultan Al Jaber, UAE minister of industry and advanced technology and ADNOC managing director and group chief executive remarked that “the agreement offers the potential for exciting opportunities for both companies to unlock and create value across the full oil and gas value chain as we shape our businesses for a post-COVID economy. We see significant potential in this agreement and look forward to converting it into mutually beneficial partnerships”.
The UAE accounts for 4.2 percent of global production of oil, all of it from ADNOC-owned and controlled oil fields. By 2030, the Abu Dhabi company expects to raise its production capacity from just over 4 million barrels per day to 5 million bpd.
Several international oil and gas companies have been invited to participate in the development of ADNOC’s hydrocarbon resources.
Over the next five years, the company expects to spend $122 billion, of which $43.5 billion would be passed on to the local economy. ADNOC and Petronas will also expand the reach of their co-operation to the downstream sector in their first agreement of this nature. The Malaysian company will look at opportunities to invest in the Ruwais chemicals hub.
Earlier, Ta’ziz, a joint venture between ADNOC and industrial holding company ADQ, was created to draw investments into the hub’s derivatives park.
Petronas will also look at fuel bunkering opportunities, especially the use of liquefied natural gas as a cleaner fuel for vessels. The oil and gas companies will also identify areas for renewable technology research and development, such as hydrogen and carbon capture, utilization, and storage.
At ADNOC, hydrogen is being prioritized as an alternative clean fuel. Blue hydrogen is formed when natural gas is split using steam methane reforming, and the Abu Dhabi company aims to increase the production of it.
ADNOC and GS Energy, a South Korean company, signed an agreement last week to expand the UAE’s hydrogen economy and carrier fuel export role.
Petronas’ President and Group Chief Executive Mr. Tengku Muhammad Taufik remarked that ADNOC and Petronas plan to “pursue value creation through progressive and cleaner energy solutions as we navigate the challenges of an accelerating energy transition”.