President Sheikh Mohamed and Malaysia's king, Sultan Abdullah Sultan Ahmad Shah, on Monday witnessed the signing of a landmark oil deal between the two nations.
An agreement has been established between Abu Dhabi National Oil Company and Malaysia's Petronas to unlock hydrocarbon resources in the emirate.
The partnership is centred on Abu Dhabi’s Unconventional Onshore Block 1, state news agency Wam reported.
“The pioneering award to Malaysia’s national oil and gas company launches the Middle East’s first unconventional oil concession,” Wam stated.
The agreement aims to build on the strong ties between the countries and marks the first time a Malaysian firm has invested in hydrocarbons in Abu Dhabi.
Under the six-year concession agreement, Petronas will hold a 100 per cent stake and operational power to explore and appraise unconventional oil in the block, which covers an area of more than 2,000 square kilometres.
“Unconventional oil” is the term used to describe oil reserves that cannot otherwise be reached using traditional drilling techniques.
The agreement was signed by Dr Sultan Al Jaber, Minister of Industry and Advanced Technology and managing director and group chief executive of Adnoc, and Datuk Tengku Muhammad Taufik, president and group chief executive of Petronas
“We are delighted to partner with Petronas on this historic unconventional oil concession,” said Dr Al Jaber.
“This award ushers a new chapter of strategic energy co-operation in the long-standing relationship between the UAE and Malaysia, and it reinforces the UAE’s position as a trusted investment destination.
“As one of the least carbon intensive oil and gas producers, Adnoc will continue to responsibly unlock value from Abu Dhabi’s vast hydrocarbon resources in a reliable and sustainable manner, to drive local economic growth and support global energy security.
“As such, we have driven the de-risking of Abu Dhabi’s unconventional oil resources and look forward to building on this with Petronas to realise the full potential of Unconventional Onshore Block 1.”