Japan’s Inpex buys stake in Abu Dhabi oil fields

TOKYO -- Inpex Corporation has acquired a 5% participating interest in the ADCO Onshore Concession in Abu Dhabi, the Tokyo-based company said Monday.

The acquisition is based on a 40-year agreement with the Supreme Petroleum Council of the Emirate of Abu Dhabi and the Abu Dhabi National Oil Company (ADNOC) effective Jan. 1, 2015, following Inpex's participation in a bid.

The acquisition underscores the strengthening of Inpex's ties with Abu Dhabi, following the extension of the concession agreement for Upper Zakum field until 2041.

The concession is made up of 15 principal onshore oil fields in Abu Dhabi of which eleven are in production and four remain undeveloped. Combined, these make up one of the world's largest deposits of oil producing 1.6 MMbpd.

In partnership with ADNOC and ADCO, the operator of the concession in which companies with participating interests hold shares, Inpex plans to proceed with development work aimed at increasing oil production to 1.8 MMbpd by 2017.

Oil produced from the concession is shipped from the port of Jebel Dhanna on the western coast of Abu Dhabi, and also transported through an oil pipeline that began operations in 2012 and shipped from the emirate of Fujairah facing the Indian Ocean.

Through its wholly owned subsidiaries Japan Oil Development Co., Ltd. (JODCO) and Inpex ABK, Ltd., Inpex has engaged in business operations in Abu Dhabi for over forty years, including the production of oil at Umm Shaif, Lower Zakum, Umm Lulu, Nasr, Upper Zakum, Umm Al-Dalkh, Satah and Abu Al Bukoosh (ABK) oil fields, where the company owns participating interests.

"This new acquisition in Abu Dhabi, positioned as one of the core areas for Inpex's petroleum development and production operations, is highly significant in terms of the company's growth strategies, and also largely contributes to the long-term, stable supply of energy to Japan," said Toshiaki Kitamura, president and CEO of Inpex Corp.

Inpex received considerable support from the Government of Japan throughout the process leading to its acquisition of a participating interest. Furthermore, Japan Oil, Gas and Metals National Corporation (JOGMEC) is expected to provide financial support for the acquisition.