Focus on Abu Dhabi: Energy Sector 2014: A year of flourishing & transformative change

Special Supplement: The Oil & Gas Journal 

Abu Dhabi remains a critical market for many of the world’s leading oil firms and the undisputed leviathan of the 7 trucial Emirate State’s that make up the UAE. 

With many longstanding closeout agreements reaching maturity this year the Emirate is set for a shake-up of its crucial hydrocarbons sector from 2014.

Yet the uncertainty surrounding the relicensing and restructuring of concessions is causing both excitement and trepidation in the industry which we shall be examining closely in our report as Abu Dhabi looks to ramp-up capacity in the coming years.
In a country holding fully 94% of the 97.8bn barrels of proven oil reserves in the UAE Abu Dhabi is the custodian of the seventh largest reserves globally and the seventh-largest producer in the World.

Our report will examine much of the current state-of-play after the expiration concession in 2014 as well as the ADMA-OPCO concession in 2018.

This will be both a pressing concern and one of the hottest topics in the global hydrocarbons industry. Especially in one of the few markets in the region where international oil companies (IOCs) can take an equity stake and book reserves.

As the government seeks out new partners for the development of their gargantuan oil & gas fields fresh opportunities will abound in Enhanced Oil Recovery (EOR) in mature fields whilst the Emirate has ambitious targets for Enhanced Oil Production and huge investment plans in their challenging sour gas reserves all providing new impetus.
There is heightened interest amongst principal IOC’S looking to further penetrate this market as they seek to capitalise on increased investment in the sector with an official objective of raising crude production to more than 3.5 million barrels per day over the next decade.
Thus presenting burgeoning opportunities in their upstream sector for everyone from existing oil majors to engineering, procurement, and construction (EPC) contractors.
With more than 52bn worth of investments announced at the last ADIPEC conference in 2012 and earmarked for expansion projects over the next 10 years Abu Dhabi’s hydrocarbon sector is amongst the most dynamic on the planet.

The consensus is that in order for the UAE to improve its competitiveness and achieve sustainable economic growth, increased investment in downstream industries and across the entire hydrocarbon value chain will be required.
Moreover, the current economic development plan for Abu Dhabi predicated on a huge expansion of the downstream refining and petrochemicals industry, hence these vast capital expenditures over the next five to ten years will provide fantastic opportunities for growth as demand for advanced technologies, products and equipment increases. 

The stage is-therefore-set for some seismic upheavals emanating from the Emirate in Global energy markets.
Which will undoubtedly present a significant opportunity for the Supreme Petroleum Council (SPC) to launch a wide-ranging reorganisation the sector and change the current structure of these very long-standing concessions, with the ADCO concession in place for almost 75 years, while the ADMA-OPCO concession was established in 1953.
Presenting a vast array of opportunities for independents and smaller players, as they seek to diversify and broaden the potential in the sector and maximize Abu Dhabi’s massive hydrocarbon wealth.


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