This decision was announced ahead of the Glasgow climate summit and it is sure to please the Western countries who are pushing for stronger climate protection laws, but it won’t require them to sell less oil.

Considering a target of 2050 to meet their target and if they succeed in the discussion that will take place in the summit, UAE could very well become the first OPEC country to reach net-zero while continuing its plans to invest in oil extraction. The net-zero charge is being led by Sultan Ahmed Al Jaber, the UAE’s special envoy for climate change and minister of industry and advanced technology.

Hana AlHashimi, who heads Al Jaber’s office, told the media on a call hosted by the US-UAE Business Council, “We are certainly working on a whole-of-government approach to see at what point it would be feasible to achieve net-zero. “I’d encourage you to stay tuned”.

The emissions that come from burning fossil fuels after they are shipped to different countries from all over the world are not included in the country-level targets. The UAE’s major revenue is still dependent on fossil fuels since it contributes around 30 percent of the country’s GDP.

The UAE is also trying to be the host of the UN’s global climate talks in 2023 and currently, South Korea is its only competitor that has set a net-zero goal by 2050

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Jaafar Altaie, managing director of Abu Dhabi-based consultant Manaar Group told the media, “This is Adnoc demonstrating that they aim to be self-sufficient. It’s a proactive step that foresees the potential for future supply shortages and that sees a need for low-cost production in the coming years.”

The announcement comes at a time when the Organisation of Petroleum Exporting Countries (OPEC) and other oil-producing nations such as Russia have sought to cut output among its members after the coronavirus pandemic caused a significant drop in demand for crude.

Earlier this year, Adnoc awarded contracts worth $245 million to upgrade two main oil lines and terminal crude receiving facilities in Abu Dhabi. The contracts were awarded to China Petroleum Pipeline Engineering Company Limited – Abu Dhabi and Abu Dhabi-based Target Engineering Construction.

The Engineering, Procurement, and Construction (EPC) contract awarded to China Petroleum Pipeline Engineering Company is valued at approximately $135 million, and once developed it will increase the capacity of the pipelines by over 30 percent. The contract is for a period of 30 months and will see over 45 percent of the award value flow back into the UAE’s economy under Adnoc’s ICV programme.

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Reportedly, Adnoc is also speeding up its original plan to produce 5 million barrels of oil per day by 2030.

Adnoc Group chief executive officer, Dr. Sultan Ahmed Al Jaber told the media, “In line with our production capacity growth strategy announced by the Supreme Petroleum Council, we are in a position to supply the market with over 4 million bpd in April. In addition, we will accelerate our planned 5 million bpd capacity target.”

“In response to market conditions, and to provide better forward visibility to our customers, ADNOC will shortly announce forward prices for the months of March and April 2020. This decision has been made to ensure that our customers have visibility of the price so they can plan accordingly.”

Currently, Adnoc supplies around 3 million barrels of oil per day to its suppliers.

Global crude oil prices have dropped by 30 percent, the lowest since the 1991 Gulf War. This drastic drop is due to the failed negotiations between Saudi Arabia-led OPEC and Russia. Saudi Arabia slashed oil prices by 10 percent last Saturday and as a result, oil stocks across various exchanges in Asia-Pacific, Tokyo, Australia, Hong Kong, and the US plunged in early Monday trading.

Recently, Saudi Arabia’s state-owned oil company Aramco has announced that it will increase crude production by 300,000 barrels per day over the company’s maximum sustained capacity of 12 million barrels.

The move to increase crude production is a part of the Saudi government’s plan to stay competitive in the global oil market amid a price war with Russia.

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Adnoc’s capital expenditure in 2019 was Dh508 million. Currently, the majority of gas stations located in Dubai are operated by Emirates National Oil Company (Enoc). Last year, Adnoc opened three gas stations in Dubai, resulting in a total of six gas stations operated by Adnoc in Dubai.

Adnoc plans to open between 20 and 25 gas filling stations in Dubai. The Abu Dhabi oil giant is also expanding into the Kingdom of Saudi Arabia, where it currently runs two gas stations.

Adnoc is looking to open stations in Egypt and targets India’s downstream segment. The media has reported that Adnoc plans to partner with Saudi Aramco for a mega refinery project in Ratnagiri in Maharashtra in India.

Adnoc is still in the nascent stages of defining its role in the project and is actively working with Aramco and Indian counterparts. Indian Oil, Bharat Petroleum and Hindustan Petroleum will be responsible for developing the mega refinery project.

Even Enoc announced in 2018 that it plans to expand into Saudi Arabia and open 45 new service stations over five years, media reports said.

Mohamed Al Hashemi, Adnoc Distribution’s CEO, told the media, “As we speak we have a handful of sites in Saudi that are clearing investment committee decision, we know exactly which sites, we know the volumes.”

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Premier Oil, a UK-based independent oil company, has acquired the stakes in the Andaman I and south Andaman blocks.
Mubadala Petroleum, which is a wholly-owned subsidiary of Mubadala Investment Company, will retain the remaining 80 participating interest in the gas fields in Indonesia.

With regard to the stake sale, Dr. Bakheet Al Katheeri, chief executive at Mubadala Petroleum told the media, “The completion of this farmout is another important step for Mubadala Petroleum and for the exploration of the Andaman blocks offshore Aceh, and supports Mubadala Petroleum’s growth strategy in Indonesia.”

The government of Indonesia has also given its approval for the deal.

Premier Oil, on the other hand, owns a 70 percent participating interest in the Andaman II block. The remaining 30 percent is owned by Mubadala Petroleum.

Mubadala Petroleum has been operating in Indonesia since 2004.

Earlier this month, Mubadala Petroleum, along with Royal Dutch Shell and Chevron, was awarded exploration rights in the Red Sea by the Egyptian government.

While Chevron and Royal Dutch Shell were awarded a block each, Mubadala Petroleum will share a block with Shell.
In the month of November 2019, Mubadala Petroleum started exploration in the Manora oil field in the Gulf of Thailand, along with Tap Oil, an Australia-based independent oil company.

While Mubadala Petroleum holds a 70 percent participating interest in the oil field, Tap Oil holds the other 30 percent.

Similarly, the UAE-based oil company also signed a production sharing contract with Thailand’s PTTEP Energy Development Company. Both the companies will work together to develop the offshore Block G1/61 that contains the Erawan field.

The post Mubadala Petroleum sells stakes in Indonesian gas fields appeared first on International Finance.

The oil giant wants foreign investors to take up a minority stake in its natural gas pipeline network. Reportedly, Adnoc has already contacted the potential bidders about the stake sale in its pipeline network and provided them with information about the asset.

With regard to the stake sale in its pipeline network, Adnoc expects infrastructure funds and private equity firms to show interests as well. Adnoc wants to finalise a deal for the pipeline stake sale by the end of the year.
According to Adnoc’s Chief Executive Officer Sultan Al Jaber, the company wants to provide new investment and partnership opportunities in a bid to bring in more foreign money into the UAE.

Previously, Adnoc has raised funds by leasing out its crude oil pipelines and listing its distribution unit on the stock market.

In a bid to bolster its regional influence, Adnoc has also decided to collaborate with the Intercontinental
Exchange (ICE) to launch a regional oil benchmark based on its Murban crude grade by next year, according to reports.

This would result in Adnoc abandoning the retroactive pricing system if often uses to determine its selling prices. This will see UAE join Saudi Arabia, Kuwait, and Iraq who uses a forward pricing system.

Adnoc is also planning a potential bond sale, according to Mark Curtis, Adnoc’s chief financial officer.

He told the media that, “We will take a look. These are historically low-interest rates, so if you’re not issuing, you’re making a big judgment call.”

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