The Abu Dhabi National Oil Company (ADNOC) signed on Monday a strategic cooperation agreement with China National Offshore Oil Corporation (CNOOC) as one of OPEC's largest producers agreed to explore upstream and downstream opportunities and liquefied natural gas (LNG) cooperation with the world's top oil and natural gas importer.
The deal is part of ADNOC's strategy to boost cooperation with foreign firms in exploration and production, as well as in the downstream segment, in order to lock in future demand for its oil and gas.
For China, the agreement would boost CNOOC's presence in the overseas market, potentially ensure diversification of oil and LNG supplies, and strengthen its energy cooperation in the Middle East, in OPEC's third-largest producer, the UAE, in particular.
Last year, ADNOC announced its intention to expand downstream operations in and outside the UAE, "to take full advantage of the rising demand for higher value refined and petrochemical products, particularly in the growth economies of China and Asia."
"The future collaboration opportunities agreed today with CNOOC reinforce ADNOC's strategic approach to partners that offer technology, capital or market access to maximise value from Abu Dhabi's vast oil and gas resources. In addition, the collaboration opportunities underpin our 2030 smart growth strategy as well as our focus on key economies and Asian growth markets such as China," UAE Minister of State and ADNOC Group CEO, Sultan Ahmed Al Jaber, said at the signing of today's agreement, as carried by Emirates News Agency.
In the past two years, ADNOC and Abu Dhabi launched the UAE's first competitive bid rounds for oil and gas exploration of conventional and unconventional resources, and continues to sign major deals to boost its downstream business, aiming to lock in future demand for its crude oil.
ADNOC has also signed strategic partnership agreements with Italy's Eni and Austria's OMV to create a trading joint venture, and aims to significantly boost its oil trading business.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More