Statoil, the Norwegian state-controlled oil and gas company, will be among the participants in landmark competitions for Abu Dhabi oil concessions that are due to expire within a few years. Helge Lund, the chief executive of Statoil, said the company was interested in competing for new licences to produce oil from some of the emirate's largest onshore and offshore fields when the contracts expire, in 2014 and 2018 respectively.
"The reason why we are here is that this is one of the regions in which, long term, we would like to work towards a partnership position," Mr Lund said. "We are positioning ourselves for the potential relicensing of the 2014 [onshore] concessions and the offshore concessions in 2018." When Abu Dhabi established its state oil concern, Abu Dhabi National Oil Company (ADNOC), in the 1970s, the Government directed it to form joint ventures with the western oil companies that had held the emirate's original oil leases since the 1930s.
In doing so, it eschewed the example of neighbouring Gulf states such as Saudi Arabia and Kuwait, which nationalised their oil sectors. These are the concessions that are soon to expire. Although the Government has indicated it wants ADNOC to continue partnerships with technologically sophisticated international oil companies, it has not disclosed the terms on which it will award the new licences or whether any newcomers will be able to bid.
Statoil, which is Norway's biggest oil and gas company, does not hold any Abu Dhabi oil concessions. It is the world's biggest offshore oil operator and a partner in three carbon capture and storage (CCS) projects that for years have been pumping the greenhouse gas into Norwegian and Algerian oilfields. Thus it could offer ADNOC access to advanced technology with direct relevance to oil operations in Abu Dhabi, Mr Lund suggested.
The former Norwegian national oil company has decades of experience of complying with Norway's tough environmental laws, so could assist Abu Dhabi with initiatives to reduce the environmental effects of extracting and processing oil and gas. Statoil would be interested in gas and oil concessions in Abu Dhabi, which, like most Gulf states, has failed to develop its substantial gas reserves fast enough to satisfy demand for the fuel.
"We are also eager to support Abu Dhabi in resolving its gas problem," Rolf Magne Larsen, a vice president in Statoil's exploration division, told the World Future Energy Conference yesterday in Abu Dhabi. Further advancing its relationship with the emirate, Statoil signed an agreement with Masdar, the Government-owned clean energy flagship, for research and development on three specific aspects of CCS, Mr Lund said.
These include advancing the technology for capturing carbon emissions and transporting carbon dioxide. The programme would draw on the resources of Statoil's research facilities in Norway and a "complementary base" in Abu Dhabi, Mr Lund said. @Email:tcarlisle@thenational.ae