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The Abu Dhabi National Oil Co said it would consolidate two of its offshore divisions in a bid to become “more agile” amid the current oil price environment. The two companies – Abu Dhabi Marine Operating Co and Zakum Development Co – produce a combined 1.2 million barrels of crude daily. After the consolidation, ADNOC plans to boost this to 1.6 million bpd, over the next two years.
The move by ADNOC is part of a larger restructuring drive in the energy industry of the UAE, as the emirates start to feel more deeply the pinch of persistently low oil prices. ADNOC, which is the country’s biggest oil company, said the point of the consolidation was to make the business “more agile, better able to respond to changing market demands, and be well positioned to take advantage of strategic opportunities for future growth.”
The restructuring of ADNOC’s offshore divisions will also involve its partners in the business, which include French Total, UK’s BP, Exxon, and Japan Oil Development Company. These companies will be part of a steering committee tasked with overseeing the process that should be completed by early 2018.
The UAE produces some 3.2 million barrels daily, but ADNOC, which is the country’s biggest oil and gas firm, said earlier this year it was planning to spend more than US$25 billion on raising this to 3.5 million bpd over the next two years.
The oil-dependent emirates are not stopping there, however. Last month, Energy Minister Suhail Al Mazroui said the government was working on plans to turn the port of Fujairah into a leading oil hub, rivaling Amsterdam and Singapore. As part of these efforts, the port started publishing weekly oil inventory data to enhance transparency.
The ambition to turn Fujairah into a global energy hub was also helped by Platts, which announced it would start publishing independent price assessments for a number of oil products sold on the Middle Eastern market on a free-on-board basis at Fujairah. The data releases started this Monday.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.