Abu Dhabi National Oil Co. awarded a stake in its largest oil concession to China National Petroleum Corp. as the Middle East emirate brings in more foreign investors to raise crude production capacity.
CNPC will take an 8% stake in the oil-production joint venture in return for paying a $1.8 billion signing bonus, ADNOC said in a statement Sunday, Bloomberg reported.
BP Plc joined the project in December for a 10% stake after Total SA took the same share in January 2015.
The deal would provide BP an output of 160,000 barrels a day, in addition to the 95,000 barrels the company now produces in Abu Dhabi.
Abu Dhabi, the largest sheikhdom in the United Arab Emirates, is boosting crude production capacity amid a global glut that cut prices to an average of about $50 a barrel over the last two years.
OPEC, of which the UAE is the fourth-biggest producer, agreed in November to cut production in effort to trim crude stockpiles and boost prices. Abu Dhabi, with about 6% of global oil reserves, aims to boost production capacity to 3.5 million barrels a day by 2018, even as it trims current output.
CNPC is joining the joint venture known as Abu Dhabi Company for Onshore Petroleum Operations, or ADCO.
Japan’s Inpex Corp. owns 5% and GS Energy of South Korea holds 3%. ADCO pumps about half of UAE’s roughly 3 million barrels of daily crude output.
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