ADNOC set to push shale-style oil, gas projects after UAE's OPEC exit
SEATTLE (Oil Monster): Abu Dhabi's ADNOC expects to make a final investment decision this year on its unconventional gas project with TotalEnergies, with approval for a separate unconventional oil project expected to follow soon, its upstream chief said.
The United Arab Emirates' May 1 exit from OPEC was a "sovereign decision taking into account the long-term strategic and economic interest of the country," state oil giant ADNOC's Upstream CEO Musabbeh al‑Kaabi told Reuters.
ADNOC's unconventional projects, which use advanced drilling techniques similar to those used in the U.S. shale industry, have been in pilot production for over a year to assess decline rates and reduce investment risks, Kaabi said at the Make it in the Emirates conference.
The oil project is partnered with Petronas and EOG Resources.
WAR IMPACTS OUTPUT
ADNOC aims to reach 5 million barrels per day (bpd) of oil production capacity by next year. UAE Energy Minister Suhail al-Mazrouei said last year capacity could be boosted to 6 million bpd if markets require it.
Kaabi declined to comment on plans beyond the 5 million bpd by 2027 target.
Operating outside OPEC's quota system gives the UAE the flexibility to meet growing global demand while delivering its "lowest cost production but more importantly the lowest carbon-intensity barrels," he said.
That flexibility is being tested as the Iran war continues to affect regional energy operations.
Kaabi declined to give current output figures, but secondary OPEC sources show UAE production fell from over 3.4 million bpd in February to just under 1.9 million bpd in March.
Output is driven by "operational matters" and offtakers, Kaabi said, adding that ADNOC is working to fulfill supply commitments "as much as possible" during "exceptional times."
Courtesy: www.reuters.com