KARACHI: Pakistan has allowed a consortium of leading petroleum companies to invest $400 million in the UAE oil exploration sector through a bidding process organized by the Abu Dhabi National Oil Company (ADNOC), the finance ministry has said.
In April 2018, ADNOC launched its first ever competitive bid round for the exploration, development, and production of oil and gas in Abu Dhabi. After the successful conclusion of the debut round, ADNOC launched a second competitive bidding round in 2019 for another set of major onshore and offshore blocks across the emirate.
In June 2021, a consortium comprising the Oil and Gas Development Company Limited (OGDCL), Mari Petroleum Company Limited (MPCL), Pakistan Petroleum Limited (PPL) and Government Holding (Private) Limited decided to invest $400 million by incorporating a company, NewCo, in the Abu Dhabi Global Market or Pakistan.
On Monday, the Economic Coordination Committee (ECC) issued a No-Objection Certificate to the consortium, clearing the way for it to proceed with the investment strategy.
“The ECC approved summary by the Petroleum Division regarding NOC for issuance of the Parent Company Guarantees/Corporate Guarantees by each of the consortium companies, on joint and several bases, in favour of ADNOC and SCFEA (Supreme Council for Finance and Economic Affairs) to pursue international exploration and production opportunity in Abu Dhabi, United Arab Emirates,” the finance ministry said on Monday.
In the 2019 Abu Dhabi bidding round, the ECC had allowed the consortium to submit a bid and make an initial investment through its own resources in proportion to its shares.
The SCFEA has yet to grant the award to explore hydrocarbon reserves.
Under the investment strategy, each consortium member will have 25% shareholding in NewCo and invest $100 million, subject to the approval of respective shareholders and the consortium being declared a successful bidder by the SCFEA.
ADNOC’s second bidding round provides a major opportunity to both new and existing partners to join the UAE-based firm in unlocking untapped resources in one of the world’s largest hydrocarbon super basins in a trusted and reliable investment environment.
Abu Dhabi's licensing strategy represents a major advancement in how the emirate is maximizing the value of its hydrocarbon resources through commercially competitive bidding. It aims to secure the right partners for the right opportunities and accelerate exploration and development of new commercial prospects.
The UAE is the world’s seventh largest oil producer, with about 96 percent of its reserves in Abu Dhabi. Located in one of the world’s largest hydrocarbon super basins, it has significant undiscovered and undeveloped potential in numerous stacked reservoirs.
