The oil and gas sector is undergoing structural changes, necessitating a different approach and innovative ways to ensure sustainability of growth and regular provision of supplies.
In light of these changes, Abu Dhabi National Oil Company (ADNOC) has announced a new strategy to deal with the latest developments in the sector. Dr. Sultan Al Jaber, Minister of State and Chief Executive Officer of ADNOC, said in an interview with Asharq Al-Awsat that measures implemented since the announcement of the new plan have confirmed that the smart growth strategy would succeed regardless of oil price fluctuations.
Al Jaber talked about a number of ADNOC’s trends during the coming period and its cooperation with Saudi Aramco.
“We have a clear and detailed plan for the coming period. We believe that the timing is very appropriate. We are working to achieve a qualitative shift to a modern company in the oil, gas, refining and petrochemical sector that operates on a commercial basis and has a long-term view that is not affected by temporary issues such as fluctuations of prices,” Al Jaber said.
He continued: “At this stage, we are witnessing a shift in the intensity of energy use from the North of the planet to the South and from the West to the East, with East Asia becoming the fastest growing energy market. There is no doubt that the oil and gas sector will continue to be the main component of the global energy mix, will actively contribute to the promotion of economic and social development worldwide and will play a key role in providing the energy needed to achieve the goals of global economic growth.”
Al Jaber explained that the UAE strategy started with a five-year plan - a short-term plan – which will see the implementation of a number of projects, many of which will be completed in 2020, including raising production capacity to 4 million barrels per day.
“For the first time, we announced a competitive bid to open six new areas entirely dedicated to exploration and development. ADNOC achieved new discoveries in 2018 that have added one billion barrels to oil reserves and 15 trillion cubic feet of gas,” he said, adding that ADNOC was working on a long-term strategy, but had very detailed features for five years to come.
He emphasized that ADNOC’s smart growth strategy was based on many pillars, which mainly include improving operational efficiency and reducing costs.
“This applies to all aspects and areas of work,” he stated.
Al Jaber underlined that ADNOC was seeking to be a model for national oil companies capable of keeping abreast of the variables of the modern energy, noting that focus was directed towards the investment and commercial side and the means to enhance economic returns and profitability.
Asked about cooperation with Saudi Aramco, ADNOC’s CEO said: “Aramco is a large and well-established company with an important history and unprecedented achievements in the sector. At ADNOC, we always look forward to working with our brothers in Saudi Arabia and Aramco, building on both companies’ strengths. Together, we can have a greater role in the sector and a bigger market through this coordination and the real desire to work together.”
He pointed to a partnership with Aramco in a refinery in India, adding that during the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC), a joint collaboration was announced between ADNOC and Aramco to explore opportunities for development and investment in the LNG sector.
“There is a relationship of cooperation in research and development, as well as in the joint development of some of the latest technologies; and this comes in line with the vision of the wise leaders in the two countries to work together in an integrated and comprehensive strategic partnership,” Al Jaber affirmed.
As for ADNOC’s expansion outside the UAE, the CEO said the focus would be mainly on refining and petrochemicals, which would have a purely economic character with strategic factors.
“This means that if the project is economically viable and contributes to ADNOC’s entry into a new market, then we will certainly study the opportunity,” he said.
