Abu Dhabi Looks To Offshore Future
Rafiq Latta reporting from Abu Dhabi
Abu Dhabi�s onshore ADNOC concession renewals may be getting all the attention (see page 1), but the future of UAE oil production lies firmly on the offshore, which is set to add over 600,000 b/d by end-2018. Further out, offshore output is poised to break through the 2mn b/d mark, if a study currently underway to expand Upper Zakum capacity to 1mn b/d is greenlighted, MEES learns.
The offshore could also see debut production from the Hail oil field, included last year in the Abu Dhabi Oil Company (ADOC) concession which runs to 2042. ADOC brings together Japan�s Cosmo Oil 63%, Nippon 31.5%, Tepco 1.8%, Kansai 1.8%, and Chubu 1.8%. Pre-qualifying has also begun for sour Hail gas. While no production target has been set, state oil firm ADNOC is eyeing around 400mn cfd. The Ghasha field, currently unassigned, is another potential major offshore project. In-place resources are high, but development presents both environmental and geological challenges.
Abu Dhabi�s northern offshore is also the likely focus of a future UAE shale oil and gas industry. Some 10-15 wells have encountered shale. Modest volumes of shale oil exist, but deeper there are more substantial reserves � amounting to �several trillion cu ft� of gas-in-place volumes, largely in the northern offshore, attendees at an 11 November ADNOC presentation heard.� Foreign oil executives are a bit more sceptical. �This stuff is not just unconventional. It is really deep,� notes one.
The ExxonMobil-led Upper Zakum field is the key increment spearheading the offshore capacity boom. The project is operated by state-owned Zakum Development Company (Zadco � state-owned ADNOC 60%, Exxon 28% and Japan�s Jodco 12%). Exxon is already claiming the longest measured well in Abu Dhabi oil industry history and a world record for geo-steering on Upper Zakum. Four new artificial islands, each around a kilometre long and housing several hundred workers, will anchor the expansion, set to start ramping up end 2014-early 2015 and hit its 750,000 b/d target in 2016.
Construction of the first island, North Island, with targeted capacity of 279,000 b/d, a planned permanent population of 500 workers and 200 well slots, has just been completed. Total island facilities� production capacity (Central Island 236,000 b/d, South Island 206,000 b/d, and West Island 103,000 b/d) at 824,000 b/d will exceed the 2016 target allowing some wiggle room. Central Island, with a population of 800 and 460 well slots (Upper Zakum will have 1,000 well slots in total) will house the central processing facility. Crude will then be pumped to the Zirku Island export terminal.
ADNOC is studying a 1mn b/d Upper Zakum target by 2024, sources say, up on earlier plans of 900,000 b/d (MEES, 2 July). Production will gradually migrate from existing facilities, and by 2046 all output will be from new island-based wells. It is unclear on what plateau target (750,000 b/d or 1mn b/d) it was based, but an Exxon presentation at the 11-13 November ADIPEC conference showed Upper Zakum plateau output continuing steady to at least 2060.� While the contracts for the other two Zadco fields expire in 2018, Upper Zakum (Exxon signed in 2006) goes on until 2026.
Adma-Opco also faces major expansions. Three new fields will be brought on by end 2018 and Lower Zakum expanded, for a total 400,000 b/d increment. Concessions for Adma-Opco, bringing together ADNOC 60%, BP 14.66%, Total 13.34% and Jodco 12%, also expire in 2018.
Saudis Lead Offshore Drive
Abu Dhabi is not alone in pushing offshore development, which will largely be focused on gas. Iran and Qatar aside, the region has until relatively recently been conservative on offshore gas development. But this is set to change, with Saudi Aramco spearheading the change.
Abu Dhabi's Offshore Oil Plans (�000 B/D)
Field/Operator | Current Production | Target Production | Date | Concession Expiry | |
Zadco | |||||
Upper Zakum^ | 550 | 750 | 2016 | 2026 | |
Umm al-Dalkh | 10 | 20 | 2014-15 | 2018 | |
Satah | 17 | 25 | 2014 | 2018 | |
Adma-Opco (Offshore) | |||||
Umm Shaif | 275 | 275 | 2018 | ||
Lower Zakum | 300 | 425 | 2016 | 2018 | |
Umm al-Lulu | 0 | 105 | 2016 | 2018 | |
Nasr | 0 | 65 | 2018 | 2018 | |
Sarb (Satah Ras al-Boot)* | 0 | 100 | 2017-18 | 2018 | |
Adoc^^ | 24 | 24 | |||
Umm al-Anbar | 2042 | ||||
Neewat al-Ghalan | 2042 | ||||
Mubarraz | 2042 | ||||
Hail | 0 | 2042 | |||
Bunduq (Shared with Qatar) | |||||
Bunduq (Abu Dhabi share) | 7 | 7 | 2018 | ||
Abu al-Bukhoosh | |||||
Abu al-Bukhoosh | 10 | 10 | 2018 | ||
Total | 1,193 | 1,806 | |||
^�� Upper Zakum starts ramping up end 2014-early 2015.
^^ Umm al-Anbar, Neewat al-Ghalan, Mubarraz collectively currently producing around 24,000 b/d of Mubarraz blend.
*Adma-Opco is running the field, but formally ADNOC has taken over operatorship.
The Saudi state oil firm is currently bringing on stream the 1.8bn cfd Karan field. And in 2014, it will start-up the 1.3bn cfd Hasbah and 1.2bn cfd �Arabiyah fields (MEES, 4 June).
Kuwait and Saudi Arabia are eying 1bn cfd from the Dorra field offshore the Neutral Zone, although this is likely to miss its 2016 target. Development of lower Gulf gas has been still slower, held up in part by politics surrounding Iran tensions. But volumes are significant � the Kish field alone holds up to 36 tcf and is aiming for a first production phase of 1bn cfd, which Iran is to develop and supply to Oman. On the Red Sea, Saudi Aramco is evaluating the results of a recent seismic survey.
Copyright MEES 2012.
