Abu Dhabi awards oil and gas block to Bharat Petroleum and Indian Oil joint venture

Urja Bharat granted production rights for onshore Block 1 in Al Ruwais

A Bharat Petroleum fuel station in Maharashtra. India is expected to be the largest source of oil demand growth until 2030, the International Energy Agency says. Bloomberg

Abu Dhabi has awarded an onshore oil and gas block to an Indian joint venture, as part of efforts to deepen energy ties between the UAE and India.

Urja Bharat, a venture between state-run energy companies Bharat Petroleum and Indian Oil, has been granted production rights by the Supreme Council for Financial and Economic Affairs (SCFEA) for onshore Block 1 in Al Ruwais, after completion of the exploration phase awarded in 2019, the Abu Dhabi Media Office reported on Wednesday.

Early exploration in the block, especially in the 38-square-kilometre Al Ruwais area, showed positive results, it said.

“The award of the production concession affirms our efforts to advance the emirate's hydrocarbon sector while ensuring the long-term economic prosperity of Abu Dhabi,” said Jassem Al Zaabi, secretary general of the SCFEA.

“This concession is part of our broader strategy to enhance the resilience and sustainability of our economy.”

Earlier this week, India and the UAE signed several major agreements covering crude oil storage, long-term supply of liquefied natural gas and co-operation in the civil nuclear energy sector.

Abu Dhabi-based Adnoc signed a preliminary 15-year agreement with Indian Oil to supply 1 million tonnes a year of LNG to India. Indian Oil is set to become the largest buyer of LNG from Adnoc by 2029. The annual purchase will reach 2.2 million tonnes, with 1.2 million tonnes coming from Adnoc's Das Island operations and one million tonnes from Ruwais LNG.

Adnoc also signed an agreement with the Indian Strategic Petroleum Reserve to extend its existing oil storage agreement.

The announcements came after a meeting between Sheikh Khaled bin Mohamed, Crown Prince of Abu Dhabi, and Indian Prime Minister Narendra Modi, in New Delhi.

India, the world’s third-largest crude importer, is expected to be the largest source of oil demand growth until 2030, the International Energy Agency said in a report earlier this year.

In the next three decades, the South Asian country is poised to experience the “largest energy demand growth” of any country in the world as industrialisation and urbanisation surge, the agency said at the time.

The UAE is among the world’s largest oil producers, and more than 95 per cent of the country’s roughly 100 billion barrels of proven oil reserves are in Abu Dhabi.