According to Oil and Gas Journal (1/1/06), the UAE contains proven crude oil reserves of 97.8 billion barrels, or slightly less than 8 percent of the world total. Abu Dhabi holds 94 percent of this amount, or about 92.2 billion barrels. Dubai contains an estimated 4.0 billion barrels, followed by Sharjah and Ras al-Khaimah, with 1.5 billion and 100 million barrels of oil, respectively. The majority of the UAEs crude oil is considered light, with gravities in the 32 degree to 44degree API range. Abu Dhabis Murban 39 degree and Dubais Fateh 32 degree blends are the UAEs primary export crude streams, though Dubais production is been falling in recent years due to the decline of its modest reserves. Most of the UAEs oil fields have been producing since the 1960s or early 1970s. Proven oil reserves in Abu Dhabi have roughly doubled in the last decade, mainly due to significant increases in rates of recovery. Abu Dhabi has continued to identify new finds, especially offshore, and to discover new oil-rich structures in existing fields.
Under the UAEs constitution, each emirate controls its own oil production and resource development. Although Abu Dhabi joined OPEC in 1967, Dubai does not consider itself part of OPEC or bound by its quotas. The UAEs current OPEC production quota (effective July 1, 2005) is 2.44 million barrels per day (bbl/d), and its current crude oil production as of May 2006 is 2.50 million bbl/d. The UAEs total production capacity is 2.50 million bbl/d, so it does not have any spare capacity at the current level of production. The Abu Dhabi National Oil Company (ADNOC) selected ExxonMobil in April 2005 as a strategic partner in the development of the Upper Zakum field, with a 28 percent ownership stake, after a competitive bidding process. A binding contract between ExxonMobil and ADNOC was finalized in March 2006. ExxonMobil is set to undertake a program of upgrades to the Upper Zakum field to raise its capacity from the current 550,000 bbl/d to 750,000 bbl/d, and introduce enhanced recovery technologies to extend the productive life of the field. The Japan Oil Development Company (JODCO) already holds a 12 percent stake in the field from a previous investment in 1972, when the field was first developed.
Several projects to upgrade infrastructure at existing oilfields are planned or underway. A project to increase the capacity of the onshore Bu Hasa field is underway, including construction of natural gas separation units, drilling of natural gas reinjection wells, and water injection. The goal is to increase sustainable production capacity to 730,000 bbl/d from the present 550,000 bbl/d by the end of 2006. A natural gas reinjection project also is planned for the onshore Bab field, which is expected to increase capacity to 300,000 bbl/d from the current 200,000 bbl/d. Bids for management of the project were received in May 2006. Upgrades planned for the onshore Sahib, Asab, and Shah (SAS) fields are set to raise capacity from the current 385,000 bbl/d to 465,000 bbl/d. Bids for the project were received in March 2006. Three small fields, al-Dabb-iya, Rumaitha, and Shanayel, have been brought onstream over the past year, offsetting production declines at more mature fields.
The UAE has two refineries operated by ADNOC. The Ruwais refinery produces light products mainly for export to Japan and elsewhere in Asia. Fuel oil from Ruwais is sold as bunkers by ADNOC and also used for domestic electric power generation. The Italian engineering firm Technip completed a $480 million expansion of the Ruwais complex to a capacity of 420,000 bbl/d in January 2006, including refits of existing units and expansion of units for production of unleaded gasoline and low-sulfur fuel oil. Umm al-Nar, also owned by ADNOC, has a capacity of 88,000 bbl/d. Since its construction in 1976, the Umm al-Nar plant has undergone debottlenecking as well as a recent expansion. UAE has three other refineries. The Emirates National Oil Company (ENOC) Jebal Ali condensate refinery, with a capacity of 120,000 bbl/d, began operations in Dubai in May 1999. Metro Oil has a 90,000-bbl/d refinery in Fujairah. A 71,250-bbl/d, second-hand unit was set up by the Sharjah Oil Refining Company in 2001. Also, a feasibility study on a possible new refinery in Fujairah is being undertaken. In October 1998, the International Petroleum Investment Company (IPIC), the UAEs downstream investment outfit, purchased 50 percent of the Hyundai Oil Refinery Company of South Korea for $500 million. The UAE is the second-largest crude oil supplier to South Korea after Saudi Arabia. IPICs overseas holdings also include a 10 percent stake in Spains CEPSA and a 19.6 percent share of Austrias OMV.