His Highness Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of UAE Armed Forces, and His Excellency Paolo Gentiloni, Prime Minister of Italy, witnessed, the signing of two historic agreements awarding Italy’s multinational oil and gas company Eni stakes in two of Abu Dhabi’s offshore concession areas.
Under the terms of the agreements, Eni has been awarded a 10% interest in the Umm Shaif and Nasr concession and a 5% interest in the Lower Zakum concession. The awards mark the first time an Italian energy company has been given concession rights in Abu Dhabi’s oil and gas sector.
Prime Minister Gentiloni underscored the importance of the agreements between Eni and ADNOC as a significant confirmation of the strategic partnership between Italy and the UAE and as a fundamental milestone for further enhancing the excellent bilateral cooperation among the two countries.
Eni contributed a participation fee of AED 2.1 billion to enter the Umm Shaif and Nasr concession and a fee of AED 1.1 billion to enter the Lower Zakum concession. Both concessions will be operated by ADNOC Offshore, a subsidiary of ADNOC, on behalf of all concession partners.
The agreements, which have a term of 40 years, backdated to March 9, 2018, were signed by His Excellency Dr. Sultan Ahmed Al Jaber, ADNOC Group Chief Executive Officer, and Claudio Descalzi, CEO of Eni.
H.E. Dr. Al Jaber said: “These agreements underline the international market’s confidence in ADNOC’s long-term growth plans and the UAE’s stable and reliable investment environment. They also broaden and diversify our partnership base, in line with the leadership’s directives, while contributing experience, technology, capital and market access.
“Our partnership with Eni, and other concession partners, will enable us to accelerate our growth, increase revenue and improve integration across the upstream value chain, as part of our ongoing transformation and build on the foundations that have been laid to deliver a more profitable upstream business.
“With these agreements, ADNOC continues to leverage its 46-year legacy of successful energy partnerships, in support of its 2030 strategy. They will enhance its ability to capitalize on key trends which are driving growing energy demand and ensure ADNOC continues to deliver long-term, robust and sustainable returns for the nation’s benefit,” H.E. Dr. Al Jaber added.
Eni is active in 73 countries, including Italy, North, West and East Africa, the Norwegian Continental Shelf, the Gulf of Mexico, the Caspian Sea, Indonesia and Australia, and Southern Europe, the Middle and Far East, the Eastern Mediterranean, the Russian Barents Sea and Alaska.
Upstream, Eni’s project management skills and field development experience have enabled it to reduce the time-to-market of new projects significantly. In 2017 the company achieved a daily average crude production of 1.8 million bpd.
Downstream, Eni has more than 60 years of experience in developing and operating refineries and has six refineries in Italy from which it produces fuel and lubricants which are sold in 23 countries. The company also has a strong petrochemicals division.
The Umm Shaif and Nasr, and Lower Zakum concessions, along with the SARB and Umm Lulu concession areas, have been created from the former ADMA offshore concession, with the aim of maximizing commercial value, broadening the partner base, expanding technical expertise, and enabling greater market access.
Eni joins an Indian consortium, led by ONGC Videsh, and Japan’s INPEX as stakeholders in the Lower Zakum concession. ADNOC is finalizing opportunities, with potential partners, for the remaining 15% of the available 40% stake in the Lower Zakum concession, and for the remaining 30% stake in the Umm Shaif and Nasr concession. ADNOC retains a 60% majority share in both concessions.