Cosmo Oil to Get 20-Year Renewal of Abu Dhabi Oil Rights
ABU DHABI (Dow Jones Newswires), Jan. 21, 2009
Cosmo Oil Co. will be granted a 20-year renewal of its oil concession in Abu Dhabi, which is set to expire in 2012, the head of the emirate's state-run oil company told reporters in a recent interview, The Nikkei (local media) reported in its Thursday morning edition.
This would cover rights in an offshore oil field that Cosmo Oil subsidiary Abu Dhabi Oil Co. (Japan) has been operating since 1973. This unit has exclusive rights to the oil field through a 45-year deal.
Yousef Omair bin Yousef, chief executive officer of Abu Dhabi National Oil Co., said the Supreme Petroleum Council -- the highest decision-making body for the emirate's oil policy -- has approved the renewal.
The Japanese unit currently produces about 18,000 barrels daily. Because it can handle up to 25,000 barrels a day, it may be granted rights to additional mining areas so that output can be increased to capacity, Omair said. The parties are to sign a new contract, possibly by the end of the year, after hammering out the specifics.
In 2007, Cosmo received money from an Abu Dhabi sovereign wealth fund with an eye on stabilizing oil supplies and renewing its oil concession. The infusion made International Petroleum Investment Co. the largest shareholder in Cosmo with a stake of roughly 20%.
Abu Dhabi is part of the United Arab Emirates, which supplies some 1 million barrels of crude oil daily to Japan, representing roughly a quarter of the country's overall imports. The amount that Japanese firms ship home through interests in Abu Dhabi equals about 25% of all the oil that domestic companies have rights to worldwide.
Japanese firms will start to see many oil concessions expire in 2012 and afterward. Currently, 18% of all the oil the nation imports comes from oil fields in which Japanese companies have interests. The Japanese government is looking to raise this intake to 40% by 2030.
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