Occidental agrees to $500 million oil exploration in Abu Dhabi

ANTHONY DIPAOLA

DUBAI (Bloomberg) -- Occidental Petroleum, the second-largest independent U.S. oil producer, agreed to a $500 million oil exploration project with Abu Dhabi over two years.

Occidental will work with Abu Dhabi National Oil, the state-owned crude producer known as Adnoc, to explore for oil at the Hail and Ghasha offshore fields in the Persian Gulf, Adnoc said in a statement distributed by the WAM state news agency. Occidental wasn’t available for immediate comment outside regular business hours in Houston. It would have a 30% share in the project that runs through 2017, Adnoc said.

Abu Dhabi, the largest emirate in the United Arab Emirates, is seeking to boost oil production capacity to 3.5 MMbopd by the end of 2017 from about 3 MMbopd now. Last month, it chose Total as the first partner in a 40-year concession for its largest onshore oil fields.

Revised bids on that 40-year project were due Tuesday, Abdullah Nasser Al Suwaidi, the company’s director general, said on Monday. Occidental was among the 11 companies initially invited to bid for the field’s development rights in 2012.

Occidental has sought buyers for assets in North America, the Middle East and North Africa to focus on fewer areas of profitable growth and has been trying to sell some of its Middle East assets to focus on U.S. operations.

Occidental is already active in Abu Dhabi, with a 40% stake in the Shah natural gas project and a partnership with Total in the Dolphin Energy gas pipeline that runs to the U.A.E. and Oman from Qatar.