COP28 President is CEO of a Joint Venture that Includes Sanctioned Russian Company LUKOIL. In October 2019, during Putin’s visit to the UAE, Emirati state-owned ADNOC awarded Russian oil and gas giant LUKOIL a 5% stake in the world’s largest offshore sour gas development, the Ghasha concession. At the time, LUKOIL was already under US sanctions. ADNOC also signed a cooperation agreement on the Ghasha project with Russia’s sovereign fund, RDIF.

Russian President Vladimir Putin and Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, witnessed the exchange of the signed agreements. Group CEO Sultan Al Jaber signed both papers on behalf of ADNOC.

Sultan Al Jaber gave LUKOIL a 5% share in the Ghasha development

On October 15, 2019, as part of the state visit of Vladimir Putin to UAE, Abu Dhabi National Oil Company (ADNOC) awarded Russia’s LUKOIL a 5% stake in the Ghasha ultra-sour gas concession. The Accession to the Ghasha Concession Agreement was signed by Vagit Alekperov, Co-founder, President, and CEO of LUKOIL, and Sultan Ahmed Al Jaber, CEO of ADNOC.

“In celebration of the friendly ties between both countries”, Russian President Vladimir Putin and Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, witnessed the exchange of the signed concession.

Al Jaber and Akperov present the ADNOC-LUKOIL Agreement to Putin and Al Nahyan. (Credit: Lukoil Press Center)

World’s largest offshore sour gas development

Under the terms of the concession award, LUKOIL will initially invest $190 million as a signing fee. LUKOIL’s share in the concession will make approximately 300,000 tons of oil and 730 million cubic meters of gas annually.

The concession comprises nine shallow gas, oil, and gas condensate fields. The fields are Ghasha, Hail, Hair Dalma, Satah, Bu Haseer, Nasr, SARB, Shuwaihat, and Mubarraz. The project should reach full capacity by 2025. Next to ADNOC and LUKOIL, other partners in the Concession are Italian ENI (25%), German Wintershall Dea (10%), and Austrian OMV (5%). ADNOC holds a 55 percent stake in the Ghasha concession.

Located offshore in the Arabian Gulf, in the western part of Abu Dhabi, the Ghasha gas field project is the world’s most extensive offshore sour gas development. It is expected to produce over 40 million cubic meters of natural gas. Also 120.000 barrels per day of crude oil and gas condensates by around 2025.

ADNOC is one of the world’s largest oil and gas producers. It has a daily output of more than 2 million barrels of oil and 3 billion standard cubic feet of gas. ADNOC plans to increase its crude production capacity to 5 million barrels per day by 2025. This is despite its CEO being the President of the 2023 United Nations Climate Change Conference (COP28).

Lukoil is a leader in the Russian oil and gas industry. It has been under US sanctions since 2014, when Russia annexed Crimea. Vagit Alekperov, the fifth richest person in Russia and a close supporter of Vladimir Putin, is the focus of current Western sanctions due to Russia’s invasion of Ukraine. In April 2022, Alekperov stepped down as President of LUKOIL. He has remained a significant shareholder, though.

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