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UPDATE 4-Total awarded stake in new Abu Dhabi oil concession, steps up pressure on peers

Thu, 29th Jan 2015 13:18

* ADNOC wants other oil firms to improve terms

* Shell gets ADNOC proposal -spokesman

* Shell, BP may get 10 pct stake each if terms agreed-source

* Onshore concession dates to '70s, yields over half UAE oil (Adds ADNOC source, Total spokeswoman)

By Michel Rose and Rania El Gamal

PARIS/DUBAI, Jan 29 (Reuters) - Total became thefirst oil major to renew a 40-year onshore concession in AbuDhabi, putting its peers under pressure to improve terms afterthe local partner said the French firm made the best offer.

The state-run Abu Dhabi National Oil Company (ADNOC) signedan agreement on Thursday with Total giving the firm a 10 percentstake in the new concession to help operate the United ArabEmirates' biggest oilfields.

Nine Asian and Western firms bid for stakes in the Abu DhabiCompany for Onshore Oil Operations (ADCO) concession after adeal with Western oil majors dating back to the 1970s expired inJanuary 2014.

Four oil majors -- ExxonMobil, Royal Dutch Shell, Total and BP -- had each held 9.5 percentequity stakes in the ADCO concession since the 1970s.

After the deal expired last year, ADNOC took 100 percent ofthe concession as political leaders in Abu Dhabi weighed upwhether to bring in Asian firms or stick with old partners,industry and diplomatic sources said.

Shell, Total and BP have made new bids, while Exxon hasdecided against bidding, sources have told Reuters.

The concession signed with Total was effective from Jan. 1,2015, and covers Abu Dhabi's 15 principal onshore oilfields thatrepresent more than half of the Gulf emirate's production.

"Total is honoured to be the first international oil companyto be chosen ... and to be entrusted with the mission oftechnical leader on two major groups of fields," Chief ExecutiveOfficer Patrick Pouyanne said in a statement.

ADNOC said in a statement that Total "presented the besttechnical and commercial offers." More companies will be addedto the concession soon, ADNOC said.

A Total spokeswoman said the company's margin on the dealwas better than the previous concession, although commercialdetails could not be divulged.

A Shell spokesman said the company had received a proposalfrom ADNOC regarding the company's bid for the onshoreconcession, giving no further details. BP declined to comment.

An ADNOC source told Reuters the firm is negotiatingseparately with other companies to bring their offers in linewith Total's.

"Shell and BP could also get a 10 percent stake each asTotal," the ADNOC source said, adding that Korea National OilCorp. was likely to get a 5 percent share, if agreed on terms.He did not elaborate on the remaining 5 percent stake.

U.S. firm Occidental Petroleum Corp, Italy's ENI, China National Petroleum Corp. (CNPC), Norway'sStatoil and Japan's Inpex have also bid.

An Inpex spokesman had no comment on Thursday.

Each company submitted two proposals -- one for a 5 percentstake and another for 10 percent, with a one-year validity, butbids were later extended.

The fields produce 1.6 million barrels per day and areexpected to reach 1.8 million bpd from 2017. (Additional reporting by Stanley Carvalho in Abu Dhabi, GusTrompiz in Paris, and Osamu Tsukimori in Tokyo; Editing by DavidEvans and Mark Heinrich)

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