Cepsa buys into Abu Dhabi offshore concession for $1.55bn
Cepsa, a Spanish oil and gas company has picked up a participating stake of 20% in an Abu Dhabi offshore concession SARB and Umm Lulu for a price of AED 5.5 billion ($1.5 billion).
The stake in the Abu Dhabi offshore concession was granted by the Abu Dhabi National Oil Company (ADNOC), representing the Abu Dhabi government.
ADNOC will hold 60% stake in the SARB and Umm Lulu concession, and will be shortly finalizing other partners to take the remainder stake of 20% in the Abu Dhabi offshore fields.
ADNOC Offshore, a subsidiary of ADNOC will be the operator of the SARB and Umm Lulu concession for which Cepsa has signed a participating agreement for 40 years. Cepsa has agreed to take over as the technical lead of the Sateh Al Razboot field, which is nothing but the SARB field in short.
Sultan Ahmed Al Jaber – CEO of ADNOC Group, 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 as we 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.”
The SARB and Umm Lulu concession is made up of the Umm Lulu and SARB, the two main fields in the Abu Dhabi offshore concession, which are both under development. Also, a part of the concession are two smaller fields named Bin Nasher and Al Bateel.
Previously, the Umm Lulu field was part of the ex- ADMA offshore concession that has been now split into three new concessions as part of a strategy of the Abu Dhabi government to maximize their commercial value while expanding the number of stakeholders.
Cepsa, which is owned by Mubadala Investment, an Abu Dhabi state-controlled investment firm, the stake in the SARB and Umm Lulu concession grows its footprint in the UAE further. It will also bolster its energy model and aligns with the company’s forecasts as highlighted in the Cepsa Energy Outlook 2030 report.
Pedro Miro – Vice Chairman and CEO of Cepsa said: “This concession agreement marks an important moment for Cepsa and our close relationship with ADNOC, with whom we are working with on a number of projects in the upstream, downstream and petrochemical sectors.
“It will add substantial reserves, in a concession with relatively low production cost, to our portfolio, and will enable us to make considerable strides towards achieving our objectives, as set out in our 2030 Strategic Plan”.
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