UAE’s ADNOC says awards Italy’s Eni stakes in new oil concessions

Courtesy photo
Updated 12 March 2018

UAE’s ADNOC says awards Italy’s Eni stakes in new oil concessions

DUBAI: Abu Dhabi National Oil Company (ADNOC) said on Sunday it had signed 40-year agreements with Eni , awarding the Italian company a 10 percent stake in its Umm Shaif and Nasr offshore oil concession and a 5 percent stake in Lower Zakum.
Eni has contributed a participation fee of 2.1 billion dirhams ($575 million) for the Umm Shaif and Nasr offshore concession and a fee of 1.1 billion dirhams for the Lower Zakum oil concession, ADNOC said in a statement.
The signing ceremony in Abu Dhabi was attended by Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed Al-Nahyan and Italian premier Paolo Gentiloni.
“The awards mark the first time an Italian energy company has been given concession rights in Abu Dhabi’s oil and gas sector,” ADNOC said in the statement.
The agreements with Eni have a term of 40 years and are backdated to March 9, 2018, ADNOC said.
“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,” ADNOC Chief Executive Sultan Al-Jaber said in the statement.
Last month, a consortium led by India’s Oil and Natural Gas Corp. (ONGC), Japan’s INPEX and Spain’s Cepsa were all awarded stakes in different areas of the offshore concession.
“This is the first award by ADNOC to a major (in the offshore renewal), and shows it is looking to find a balance in its strategic partners between companies from major buyers, such as Japan and India, and IOCs (international oil companies) with technology and project delivery expertise,” said Tom Quinn, senior research analyst, Middle East Upstream, Wood Mackenzie.
The ADNOC deal also provides low-risk, long-term supply to Eni, and lays the foundation for the Italian company’s Middle East portfolio, Quinn said.
ADNOC said on Sunday it was still finalizing opportunities with potential partners for the remaining 15 percent in the Lower Zakum concession and for the remaining 30 percent stake in the Umm Shaif and Nasr concession. ADNOC will keep a 60 percent share in both concessions.
In August, ADNOC said it would split its ADMA-OPCO offshore concession into three areas — Lower Zakum, Umm Shaif and Nasr, and Sateh Al Razboot and Umm Lulu — with new terms to unlock greater value and increase opportunities for partnerships.
The existing ADMA-OPCO concession, which expired on March 8 produces around 700,000 barrels per day (bpd) of oil and is projected to have a capacity of about 1.0 million bpd by 2021.
The original shareholders in the ADMA-OPCO included BP , and Total SA.


Aramco shares to make debut as biggest IPO gets bigger

Updated 11 December 2019

Aramco shares to make debut as biggest IPO gets bigger

  • Samba Capital, NCB Capital and HSBC Saudi Arabia issued a statement late Monday
  • Saudi subscribers were allocated 96.6 percent of the retail offering

LONDON : Saudi Aramco shares make their stock market debut on Wednesday as it emerged that the oil giant could raise even more from its already record-breaking share sale.

Aramco will exercise its 15 percent “greenshoe option” either in part or in whole during the first 30 days of its trading period, its lead managers said.

A greenshoe option is financial jargon for a clause that allows an underwriter the right to sell investors more shares than planned if demand proves higher than anticipated.

Samba Capital, NCB Capital and HSBC Saudi Arabia issued a statement late Monday confirming an earlier report on the Al Arabiya news channel citing an NCB Capital executive.

It means the share sale could generate as much $29.4 billion if exercised fully. The main IPO raised $25.6 billion on Thursday.

Samba Capital said that the IPO was hugely oversubscribed, attracting aggregate subscriptions of SR446 billion, representing coverage of 465 percent.

The listing and trading of the company’s shares on Tadawul starts just four working days after the end of the subscription phase, Samba noted.

The number of individual subscribers was 5.056 million, who bought SR49.2 billion worth of shares.

Saudi subscribers were allocated 96.6 percent of the retail offering with non-Saudis (expatriates and GCC nationals) getting 3.4 percent. 

For the institutional tranche, the final value of subscriptions totaled SR397 billion.

The Saudi Aramco IPO is a key part of the Kingdom’s plan to transform its economy by reducing its reliance on oil, developing its financial markets and attracting increased levels of foreign direct investment.

Saudi Finance Minister Mohammed Al-Jadaan said that the proceeds from Aramco’s IPO would be reinvested, helping to create more revenue channels for the government.

The Aramco IPO is expected to pave the way for more privatizations in the Kingdom.

“Privatization is at the top of the government’s priorities,” Al-Jadaan told reporters on Monday.

“We will continue to support big projects and will continue to support promising projects,” he said. “Enabling the private sector is the top priority of Vision 2030. We have more to come and our journey toward Vision 2030 demands