Adnoc awards $1.5bn concession to Cepsa

Abu Dhabi / WAM

On behalf of the Abu Dhabi Government, the Abu Dhabi National Oil Company (Adnoc) on Sunday signed an agreement with Cepsa, a Spanish integrated oil and gas company, awarding it a 20 percent stake in Abu Dhabi’s offshore SARB and Umm Lulu concession.
The choice of Cepsa, which is wholly-owned by Abu Dhabi’s Mubadala Investment Company and operates across the entire oil and gas value chain, underpins Adnoc’s strategy to maximise returns from its resources, expand its Downstream business, and retain value for the UAE. The concession area is made up of two main fields under development, Umm Lulu, which is part of the former ADMA offshore concession, and SARB, as well as two smaller fields, Bin Nasher and Al Bateel. The ADMA concession has been split into three new concessions to maximise commercial value, broaden Adnoc’s partner base, expand technical expertise, and enable greater market access.
Cepsa contributed a participation fee of AED5.5 billion, or $1.5 billion, to enter the concession, which also takes into account previous Adnoc investments in the concession area. Adnoc retains a majority 60 percent stake in the concession that will be operated by Adnoc Offshore, a subsidiary of Adnoc.
The agreement, which has a term of 40 years and an effective date of March 9, was signed by Dr Sultan bin Ahmad Sultan Al Jaber, Minister of State and Adnoc Group CEO, and Pedro Miro, Vice Chairman and
CEO of Cepsa. Dr Al Jaber said, “This long-term agreement is a milestone in the development of Abu Dhabi’s integrated oil and gas sector and in the delivery of Adnoc’s 2030 smart growth strategy. This partnership ensures we continue to maximise value from our hydrocarbon resources, in line with the leadership’s directives, by capturing that value and financial return here in the UAE.
“The agreement also reflects Adnoc’s new partnership approach, as we expand and diversify our partner base across Adnoc’s integrated value chain. Reflecting our strategic approach, we are also working with Cepsa to explore expansion opportunities in our downstream business, in the UAE and overseas, that will deliver competitive returns and long term growth opportunities for both parties, and for the UAE.”
Cepsa, which has been operating in the energy sector since 1929, has businesses in over 20 countries across five continents. Its operations span exploration, production, refining, distribution and marketing, chemicals, gas and power, trading, bunkering and renewable energy sources. It is the world’s largest producer of Linear Alkyl Benzene, LAB, and also the leading producer of cumene and the second in phenol and acetone, thanks to its seven chemical plants, in Europe, Asia and the Americas.