Adnoc to develop small reservoirs

The offshore arm of the Abu Dhabi National Oil Company aims to boost oil production by up to 25 per cent in the next few years.

In an effort to boost its oil production by up to 25 per cent in the next several years, the offshore arm of the Abu Dhabi National Oil Company (Adnoc) is working to develop a new class of slightly smaller reservoirs. "We are going to the second-size fields to increase the production," said Ali Rashid al Jarwan, the general manager of the Abu Dhabi Marine Operating Company (Adma-Opco), which produces up to 600,000 barrels of oil per day (bpd).

Mr Jarwan described the fields as big by international standards, but smaller than renowned offshore giants like Zakum and Umm Shaif, which each contain billions of barrels of oil. He declined to be more specific, but Mussabeh al Kaabi, the manager of Adnoc's exploration division, said in June that the company was interested in developing fields of 100 million barrels or less, which had been passed over when oil prices were low.

The drive to exploit smaller fields, both on- and offshore, is part of Adnoc's strategy to raise total oil production capacity to 3.5 million bpd - from just over 2.7 million today - to take advantage of high oil prices and meet increasing global demand for energy. Expansion plans have been delayed several times, and officials now say the first capacity increases should be implemented by 2011. Mr Jarwan said Abu Dhabi's capacity expansions will be split evenly between offshore and onshore fields, mirroring the distribution of the emirate's reserves.

In March, Adma-Opco announced a long-term goal of increasing capacity to one million bpd by 2019. The Abu Dhabi Company for Onshore Oil Operations said it will increase production by 400,000 bpd by 2011, to 1.8 million bpd from 1.4 million today. The Zakum Development Company (Zadco), Adnoc's third major production arm and operator of the offshore Upper Zakum field, has plans to raise production by 200,000 bpd by next year, to 750,000 bpd from 550,000 bpd today.

Despite the ambitious expansion program, Mr Jarwan emphasised that sustainable production remains Adnoc's ultimate goal. He said the company was looking at "production development in a responsible way, and a sustainable manner". For Adma-Opco, that means focusing on new fields that would produce oil or gas for at least 25 years. In the short term, Adma-Opco is preparing to suspend production of between 150,000 to 200,000 bpd for 40 days in October and November for annual maintenance of gas processing facilities on Das Island operated by the Abu Dhabi Gas Liquefaction Company (Adgas).

Since Abu Dhabi has a strict ban on flaring associated gas that comes out with oil, the shutdown of the Adgas facilities means Adma-Opco will have to curtail its own oil production from the Lower Zakum and Umm Shaif fields. "For us, it's an opportunity to tie up loose ends," said Mr Jarwan. Mr Jarwan said the Das Island facilities, which were built in the 1970s, were now checked regularly for problems. This year's focus will be Train 2, a line of equipment that produces 1.5 million tonnes of liquefied natural gas every year.

Mr Jarwan noted the disruption in production paled in comparison to last year, when Adma-Opco and Zadco took 800,000 bpd of offshore production offline for 15 days, to complete the biggest maintenance operation in the country's history. Mr Jarwan said last year's large-scale maintenance run would not have to be undertaken again for many years. @email:[e-mail]