Mubadala Petroleum aims to double its business in the next decade to become a US$20 billion company.
Part of the growth of the UAE Government’s oil and gas producer abroad could stem from an agreement signed this week with Abu Dhabi National Oil Company (Adnoc) to cooperate in exploration overseas and in unconventional technologies, said Maurizio La Noce, the chief executive of Mubadala Petroleum.
The memorandum of understanding provides a framework for for using unconventional oil and gas technology and developing small gasfields outside the country.
“The desire is to further opportunities for growth, and so we’re going to be discussing exploration internationally together,” said Mr La Noce on the sidelines of Adipec, the oil and gas conference in the capital. “This would be an area where we could learn from the expertise that Adnoc has developed over the years and complement that with our expertise.”
Mubadala Petroleum’s ambitions come as other energy companies of Arabian Gulf producers seek to become bigger international players.
Abu Dhabi National Energy (Taqa) has acquired positions in a strategic gas storage project in the Netherlands and followed energy majors such as ExxonMobil and Total into Iraqi Kurdistan. And Saudi Aramco has increased its capital budget to $40bn from $4bn over the past decade to transform itself into what its chief executive calls “the world’s most integrated energy company”.
Today, Mubadala operates in the Middle East, Africa, the Caspian Sea and South East Asia, where this month it completed its first full-field gas development in Indonesia.
With shared assets in Libya, Bahrain, Qatar, the UAE and Oman, Mubadala Petroleum – which was spun off from Mubadala Development Company last year – is closely aligned with Occidental, the United States upstream producer that is planning to sell as much as 40 per cent of its Middle East assets.
Mr La Noce declined to say if his company was in discussions with Occidental to buy the assets.
“We are partners with them in most of their assets in their Middle East business … we are, I wouldn’t say, interested, we are observing with interest what’s going on,” he said. “At the same time though, the question that really should be asked is do we want more of what we have already?”
Both companies are joint-venture partners in Dolphin Energy, the company that transports Qatari gas to the UAE and Oman.
Mr La Noce said Dolphin was receiving 300 million to 500 million standard cubic feet of excess Qatari production per day on top of the normal 2 billion cu ft it imports, and it was in the process of negotiating for additional volumes.
The company is also a joint-venture partner with International Petroleum Investment Company in Emirates LNG, a gas import terminal being built in Fujairah.
The Adnoc agreement, which also paves the way for employees to gain international experience through secondments, will allow the companies to evaluate the possibility of replicating North America’s success in areas such as shale or tight oil and gas in other geographies.
That could be a challenge, given that the US has an unusual exploration environment, with a deep knowledge of existing reservoirs, developed infrastructure to make it easy to move discoveries to market, and laws that allow landowners, rather than the government, to have the rights to underground hydrocarbons.
“We’re going to work together with Adnoc to understand the possibilities, to understand the technologies, to understand what it requires,” said Mr La Noce. “But again, we’re very cautious about unconventionals… There are no proxies. Every play is going to be different. It’s going to be an interesting road.”
ayee@thenational.ae