Abu Dhabi National Oil Company (Adnoc) has signed an exploration concession agreement with a consortium of four Pakistani state-owned companies, awarding the group exploration rights for Abu Dhabi’s Offshore Block 5.
The consortium consists of Pakistan Petroleum, Mari Petroleum Company, Oil & Gas Development Company and Government Holdings (Private). The consortium is led by Pakistan Petroleum.
The award is the first time Pakistani companies have invested in exploring for oil and gas in an Abu Dhabi concession, as well as the first time Adnoc has partnered with Pakistani energy companies.
Under the terms of the agreement, the Pakistani consortium will hold a 100 per cent stake in the exploration phase, investing up to $304.7m towards exploration and appraisal drilling, including a participation fee, to explore for and appraise oil and gas opportunities in Block 5.
The block covers an offshore area of 6,223 square kilometres and is located 100 kilometres northeast of Abu Dhabi city.
Following a successful commercial discovery during the exploration phase, the consortium will have the right to a production concession.
Adnoc has the option to hold a 60 per cent stake in the production phase of the concession.
The term of the production phase is 35 years from the commencement of the exploration phase.
Pakistan Petroleum operates 15 producing fields across Pakistan and contributes over 20 per cent of the country’s total natural gas supplies.
As of June 2020, the company’s proven recoverable reserves were 1,793.5 billion cubic feet of natural gas, 13.3 million barrels of oil / natural gas liquids (NGLs) / condensates, and 543.1 thousand tonnes of liquefied petroleum gas (LPG).
Offshore Block 5 is included in Abu Dhabi’s second hydrocarbons block competitive bidding round, which Adnoc launched in May 2019.
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