State-owned Abu Dhabi National Oil Co, (Adnoc) is seeking to cut 25% off its operating and capital spending, a senior official at the company was quoted as saying Thursday.
"...we are trying to bring down operating expenditures and also on [capital expenditures] in the range of 25%," Ali al-Shamsi, Adnoc's head of strategy and coordination told The National newspaper.
This reduction is in line with cuts in global capital investments of 20-30%, Shamsi told the Abu Dhabi owned paper, more than $100 billion worldwide.
However, this does not mean that the UAE's major oil development plans have changed, Shamsi said, but that the company was trying to streamline, optimize field development and take advantage of reduced materials and engineering costs.
Adnoc hopes to boost oil production capacity to 3.5 million b/d by the end of 2017, from around 3 million b/d now.
One of the biggest projects to be delayed this year, is for the construction of new production facilities expansion at the onshore Bab oil field.
The new facilities at the Bab field will achieve a sustainable production rate of 450,000 b/d from around 300,000 b/d. Bids have been submitted, but sources at the bidding companies say the project is on hold, at least for this year. The cost-cutting comes while Abu Dhabi continues to negotiate with international oil companies for stakes in the Abu Dhabi Company for Onshore Oil Operations (Adco) concession, which covers the emirate's major onshore oil fields representing more than half its production.
The new 40-year production sharing agreements offer access to fields with more than 100 billion barrels of oil still in place. But after several years of talks, Abu Dhabi has so far announced only three partners for the new concession -- Total, with a 10% working interest, Japan,s Inpex (5%) and a joint venture of South Korea's KNOC and GS Energy (3%). Another 22% is still up for grabs.
