Estimates suggest blocks hold multiple billion barrels of oil and multiple trillion cubic feet of natural gas
Abu Dhabi National Oil Company (ADNOC) announced on Tuesday the details of the initial round of six geographical oil and gas blocks open for bidding.
The move is part of Abu Dhabi’s first ever block licensing strategy and follows the announcement last month by Dr Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO that Abu Dhabi was to launch its first ever competitive exploration and production bid round.
Estimates suggest these new blocks hold multiple billion barrels of oil and multiple trillion cubic feet of natural gas.
The six blocks open for bidding, two of which are offshore and four are onshore, cover an area of between 2,500 and 6,300 sq km, which, by comparison, is up to three quarters of a UK North Sea quadrant, consisting of 30 blocks. In total, Abu Dhabi’s six blocks comprise an area of almost 30,000 sq km.
Al Jaber said the licensing strategy represents a major advance in how Abu Dhabi unlocks new opportunities and maximizes value from its hydrocarbon resources.
The successful bidders will enter into agreements granting exploration rights and, provided defined targets are achieved in the exploration phase, be granted the opportunity to develop and produce any discoveries with ADNOC, under terms that will be set out in the bidding package.
Al Jaber said: “The launch of these large new licensing blocks is an important step for Abu Dhabi and ADNOC as we develop and apply new strategies to realize the full potential of our resources, maximize value through competitive bidding and accelerate the exploration and development of new commercial opportunities.
“This approach is central to our expanded partnership strategy, which aims to introduce new opportunities as we broaden and diversify our partnership base. In addition, as we begin to expand our downstream portfolio, the new licensing blocks reinforce our long term production growth ambitions and builds on our successful legacy as a leading upstream player. This is a rare and exciting opportunity, for both existing and new partners, in a secure and stable investment environment.”
The UAE is the world’s seventh largest oil producer, with about 96 percent of its reserves within the emirate of Abu Dhabi.
The closing date for the receipt of bids will be in October, after which ADNOC will evaluate the bids, using the criteria set out in the bidding instructions. The first bid round is planned to conclude this year.