Abu Dhabi Upper Zakum Expansion Cost Seen Over $1.5 Billion
DUBAI, Dec 08, 2006 (Dow Jones Newswires)
Abu Dhabi will boost crude production from one of the world's largest oil fields, offshore Upper Zakum, by around half within the next decade at a cost of more than $1.5 billion, according to official documents seen by Dow Jones Newswires.
Zakum Development Co., the operator of the oil field in which ExxonMobil Corp. (XOM) has a 28% equity stake, has invited engineering consultancies to help it manage the project, which will raise production to 750,000 barrels a day by 2016, from around half a million barrels a day currently.
The project will help state-run Abu Dhabi National Oil Co., or Adnoc, the majority shareholder in Zadco, stem a decline in its other fields and boost overall production in the emirate, the largest oil producer within the United Arab Emirates. It is unclear what the net change in Abu Dhabi's output will be once the expansion of Upper Zakum is completed.
The U.A.E. is the fourth largest producer in the Organization of Petroleum Exporting Countries.
According to the documents, Zadco has asked consultants to submit by Dec. 17 their formal registration documents in managing the project, with the contract awarded in the second quarter of next year.
The winner will oversee the implementation of the Upper Zakum expansion, set to be completed by the end of 2015. They will help in selecting and appointing contractors to carry out front-end engineering design and construction.
The production hike will come from the development of the field's eastern and western areas and will require the installation of 20 new well-head platforms and several pipelines.
Adnoc holds a 60% stake in Zadco, Japan Oil Development Co., holds a 12% and ExxonMobil the remainder.
The Irving, Texas company secured its stake from Adnoc in March after competing against six other companies.
Copyright (c) 2006 Dow Jones & Company, Inc.
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