Total enters into two new 40 year concessions with ADNOC

Total has extended its commitment to the Abu Dhabi by entering into two new 40 year concessions with ADNOC for USD1.45 billion. This follows the deal last week between Eni and ADNOC.

Total has been granted a 5% interest in Lower Zakum and 20% interest in the new Umm, Shaif & Nasr concession. Total notes that the access cost equates to USD1/boe of reserves.

Comparison of transactions

	Total	Eni
Lower Zakum	5%	5%
Uum, Shaif & Nasr	20%	10%
Price Paid	USD1.45 billion	USD875 million

Each concession has a target production of c.450mbopd – the partners intend to grow production to these levels and beyond. At Umm, Shaif & Nasr, as well as growing production from the current 300mbopd, the fields have substantial gas reserves and could support 500mmcfpd. The gas would be used domestically to reduce the reliance on imports while associated condensates can be used in the petrochemicals industry.

The UAE remains an important region for Total who has been in the country for 80 years. Current production from Abu Dhabi alone is c.290mboe/d or 11% of the group’s overall production.

The Lower Zakum concession includes ONGC Videsh (10%), Inpex (10%), Eni (5%) and Total (5%). ADNOC expects to sign a deal for the remaining 10% stake, and has 60% interest.

For the Umm, Shaif & Nasr concession, Total has 20% interest, alongside Eni (10%), with ADNOC having 60% interest. A further agreement for the remaining 10% stake is yet to be signed.