OMV and ADNOC officials at signing ceremony. Credit: Rashed Al Mansoori, Crown Prince Court.

Austrian oil and gas company OMV has signed an agreement with Abu Dhabi National Oil Company (ADNOC) for 20% stake in Satah Al Razboot (SARB) and Umm Lulu offshore oil concessions in the UAE.

OMV contributed a participation fee of $1.5bn for the 40-year contract, which also includes infrastructure associated with the concessions.

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While ADNOC is set to retain a 60% stake in the offshore concession, which will be operated by its subsidiary, the award to OMV is intended to maximise returns from its resources and bolster the downstream business.

ADNOC Group CEO Sultan Ahmed Al Jaber said: “The expansion of the global economy and increasing demand for oil, refined products and petrochemicals, provide us with new opportunities to create value across our upstream and downstream business.

“The offshore concession award is an important milestone in OMV’s delivery on strategy 2025, as we expand our footprint in one of the world’s leading oil and gas hubs.”

“To seize these opportunities, we will work closely with OMV, and our other partners to further optimise operational efficiencies, enhance performance, and capture future growth opportunities.”

Located 120km away from Abu Dhabi in shallow waters, the SARB field is scheduled to start production by the end of this year. The oil production at plateau rates is expected to be more than 20kbbl/d.

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The Umm Lulu field, located 30km away from the city, commenced production in 2016 and is expected to reach the same oil production plateau in the next ten years.

OMV noted that together, the fields will fetch about 450 million barrels of oil over the contract period, during which the company estimates to bear capital costs of $2bn.

OMV executive board chairman and CEO Rainer Seele said: “The offshore concession award is an important milestone in OMV’s delivery on strategy 2025, as we expand our footprint in one of the world’s leading oil and gas hubs.”