The Abu Dhabi National Oil Company (ADNOC) announced the signing of an exploration concession agreement, awarding the exploration rights for Abu Dhabi’s Offshore Block 4 to Cosmo E&P Albahriya Limited, a wholly-owned subsidiary of Japan’s Cosmo Energy Holdings Co., Ltd. (Cosmo). The award has been approved by Abu Dhabi’s newly formed Supreme Council for Financial and Economic Affairs (SCFEA) and marks the first of such awards endorsed by the SCFEA.
The exploration concession agreement further strengthens Abu Dhabi’s long-standing partnership with Cosmo as well as the UAE-Japan strategic bilateral relationship. The award of Offshore Block 4 follows the recent exploration block awards to Occidental as well as a consortium led by Italy’s Eni and Thailand’s PTTEP, highlighting ADNOC’s ability to continually deliver value in Abu Dhabi’s second competitive block bid round and leverage its strategic partnerships to accelerate the exploration and development of Abu Dhabi’s hydrocarbon resources.
The exploration concession agreement was signed by His Excellency Dr. Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology and ADNOC Group CEO, and Hiroshi Kiriyama, Group CEO of Cosmo.
Following a successful commercial discovery during the exploration phase, Cosmo will have the right to a production concession to develop and produce such commercial discoveries. ADNOC has the option to hold a 60 percent stake in the production phase of the concession. The term of the production phase is 35 years from the commencement of the exploration phase and the block offers the potential to create significant in-country value for the UAE over the lifetime of the concession.
In addition to drilling exploration and appraisal wells, the exploration phase will see Cosmo leverage and contribute financially and technically to ADNOC’s mega seismic survey, which is acquiring 3D seismic data within the block area. The data already acquired over a large part of the block combined with its proximity to existing oil and gas fields, suggests the concession area has promising potential.
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