UAE's Adnoc signs oil and gas agreement with China's CNOOC
Fullstream deal to ensure Adnoc's growth in world's largest oil importer, where petrochems demand will double by 2040
Abu Dhabi National Oil Company (Adnoc) signed a strategic framework agreement with China National Offshore Oil Corporation (CNOOC) for collaboration in the upstream and downstream sectors, as well as liquefied natural gas (LNG), with the ceremony witnessed by HH Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, and Xi Jinping, President of the People’s Republic of China.
UAE Minister of State and Adnoc Group’s chief executive officer, Dr Sultan Ahmed Al Jaber, signed the agreement with CNOOC chairman, Yang Hua.
Adnoc plans to grow its oil production capacity to five million barrels per day by 2030, and the agreement with CNOOC is expected to offer further growth opportunities for the UAE national oil company in China, the world’s second-largest economy and largest oil importer, where demand for petrochemicals and plastics is expected to double by 2040.
Adnoc and CNOOC’s agreement covers knowledge-sharing in the area of ultra-sour gas development.
The firms will also consider including Offshore Oil Engineering Co (COOEC) as a qualified contractor for engineering, procurement, and construction opportunities that emerge through their collaboration.
China Oilfield Services will be considered for inclusion as a qualified supplier of oilfield services to work with both companies on future oil and gas projects.
Adnoc and CNOOC’s agreement includes the joint study of LNG buying and selling opportunities, as well as scope to share knowledge about LNG markets, and evaluate potential partnerships and investment opportunities across the LNG value chain.
In the downstream sector, Adnoc and CNOOC have agreed to analyse the potential of mutually beneficial business opportunities, including possible collaboration on new integrated refining and petrochemical assets in China; cooperation in CNOOC’s existing refining assets; and greater joint investment across the refining and petrochemical value chain.
Commenting on the partnership, Al Jaber said: “This far-reaching framework agreement underpins the close economic ties between the UAE and China, and offers exciting new growth opportunities as well as mutually beneficial investment initiatives between Adnoc and CNOOC, while enabling the wider potential for strategic collaboration in both the upstream and downstream.
“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.”
According to UAE state news agency, Wam, Hua said the agreement would further China’s energy cooperation with countries on the Belt and Road Initiative’s route, adding that the collaboration help CNOOC promote its overseas oil and gas growth.