ADNOC awards Lukoil 5% stake in Ghasha gas concession

Umar Ali and Himaja Ganta 16 October 2019 (Last Updated October 16th, 2019 12:27)

The Abu Dhabi National Oil Company (ADNOC) has awarded Russian oil and gas company Lukoil a 5% share in the Ghasha gas concession in the Persian Gulf.

ADNOC awards Lukoil 5% stake in Ghasha gas concession
The Ghasha project is expected to produce over 40 million cuber metres of natural gas and 120,000 barrels of crude oil and gas condensates per day. Credit: NASA.

The Abu Dhabi National Oil Company (ADNOC) has awarded Russian oil and gas company Lukoil a 5% share in the Ghasha gas concession in the Persian Gulf.

The concession agreement was signed by Lukoil president Vagit Alekperov and ADNOC CEO Sultan Ahmed Al Jaber on 15 October 2009 as part of Russian President Vladimir Putin’s state visit to the United Arab Emirates (UAE). The development of the Ghasha concession marks the first time that a Russian company has joined a project in the UAE.

ADNOC, Lukoil and the Russian Direct Investment Fund (RDIF) also signed a tripartite framework agreement for future co-operation on the Ghasha concession.

RDIF CEO Kirill Dmitriev said: “The large-scale project to develop the Ghasha Concession opens up great investment opportunities for RDIF and LUKOIL.”

The agreement with ADNOC reflects a high level of energy cooperation with the UAE and confidence in the expertise of partners from the Russian Federation to help develop one of the major natural resources projects in the Middle East.”

The Ghasha ultra-sour gas project is located on the north-western shore of Abu Dhabi, consisting of nine shallow fields containing undeveloped oil, gas and gas condensate deposits. The project is expected to produce over 40 million cubic metres of natural gas per day and 12,000 barrels of crude oil and gas condensate per day.

Other partners in the project include Eni (25%), Wintershall DEA (10%) and OMV (5%).

Alekperov said: “The development of the Ghasha concession is the first Lukoil project in the UAE and we are pleased to partner with ADNOC and cooperate with RDIF in this project.

“Lukoil has extensive experience in offshore fields, both independently and in consortia with other major international companies. We are glad to enter the project in the UAE with such a significant resource base and with such experienced partners. Joining this project is fully consistent with our strategy.”

Al Jaber said: “The concession award, as well as the framework agreement, reflect the strong and strategic bilateral ties between the UAE and Russia and highlight the important role of energy cooperation in strengthening the relations between our two countries.

“Lukoil joins our other value-add partners on the Ghasha concession, which is integral to our objective of enabling gas self-sufficiency for the UAE.

“The transaction is consistent with ADNOC’s targeted approach to engage with strategic partners that contribute the right combination of best-in-class expertise and advanced technology, market access or capital to unlock maximum value from Abu Dhabi’s resources for our mutual benefit while delivering the greatest possible returns to the UAE.”