Adnoc and Exxon Mobil to jointly explore upstream R&D opportunities

The US oil major is a stakeholder in Upper Zakum field, which is being developed to reach 1m bpd capacity by 2024

Adnoc's headquarters in Abu Dhabi. Fitch affirmed the group's standalone credit profile at AA+. Courtesy: Adnoc

Abu Dhabi National Oil Company and Exxon Mobil's local subsidiary on Thursday signed an agreement to jointly explore research and development opportunities across the upstream sector.

The two sides will "identify areas of mutual interest for conducting R&D and co-developing technology solutions that will help increase upstream operational efficiencies," Adnoc said in a statement.

The companies have already earmarked a number of areas for joint investment into research, such as non-metallic solutions, field testing and integrity management, smart reservoir management, well monitoring systems and innovative emergency response systems.

The mutual R&D development will "complement" technical contributions that the US oil major has brought to the Upper Zakum offshore concession, in which it has been a partner since 2006, according to Christian Lenoble, president of Exxon Mobil Al Khalij and the company's UAE lead manager.

The US energy company, alongside other international stakeholders, is working with Adnoc to increase production capacity on the Upper Zakum field to 1 million barrels per day by 2024.

Adnoc holds a 60 per cent ownership in the concession, while the US major has a 28 per cent stake and the Japan Oil Development Company holds the remaining interest.

The partners are upgrading capacity through artificial island development and extended reach drilling technology.

Adnoc is looking to increase production capacity to 5m bpd by 2030. The state oil company on Wednesday awarded Occidental Petroleum exploration rights to an onshore block in a Dh514 million contract.

The 35-year concession for onshore Block 5 is the first Adnoc has awarded following the successful completion of its second bid round.