UAE looking to open oil sector to more partners

UAE looking to open oil sector to more partners

The United Arab Emirates (UAE) may allow more foreign partners, especially Asian energy companies, to take stakes in more marginal fields, the chief executive of Abu Dhabi Marine Operating Company (ADMA-OPCO) said on Tuesday.

July 3, 2012 5:18 by Reuters

The UAE’s concessions system allows oil and gas producers to acquire their own equity hydrocarbons from the OPEC member in return for investing in projects.

Multinational companies, predominantly Western oil firms, have held large stakes in the concessions for decades, but concession renewals starting from 2014 could see Asian companies boost their presence in a country which now exports nearly all its oil to Asia.

“The principal of the tender is be more open for partners,” ADMA-OPCO CEO Mohammed Sahoo Al Suwaidi told reporters.

“In the last 3 years there has been a change towards more openness, some additional partners.”

Abu Dhabi plans to invest $60 billion over the next five years in a bid to boost the UAE’s oil production capacity from 2.7 million to 3.5 million barrels per day (bpd) and may welcome Asian companies.

The ADMA-OPCO concession, which has a capacity of around 550,000 bpd, expires in 2018. The firstUAE concession renewal is expected in 2014.

Japanese refiner Cosmo Oil has already secured a new concession area, while South Korea has also secured access to UAE oil reserves in a deal with Abu Dhabi National Oil Co (ADNOC).

“There’s consideration to have newcomers in these marginal fields,” Suwaidi said when asked if Korean and Chinese companies could be awarded some field rights.

ADNOC holds a controlling stake in each exiting concession which it operates with several partners – a system which irks some big oil companies who do not want to share their technology with rivals.

(Editing by Daniel Fineren and Jason Neely)