Oil & Gas

China’s Zhenhua Oil is set to double its oil offtake from Abu Dhabi National Oil Company (Adnoc) to 200,000 barrels per day (bpd), after securing a new leadership role in developing one of the UAE’s top oilfields, according to three Chinese industry sources. In January, Zhenhua replaced TotalEnergies as the asset leader for the Bu Hasa oilfield—Adnoc’s largest onshore oilfield—following a competitive bidding process. As asset leader, Zhenhua is now responsible for setting Bu Hasa’s development plans and ensuring production and cost targets are met.

In conjunction with this new role, Zhenhua agreed to an additional annual crude supply deal for 5 million tonnes (approximately 100,000 bpd) from Adnoc. This is in addition to Zhenhua’s existing 100,000 bpd offtake as an equity partner in Adnoc Onshore, bringing its total contracted volume to 200,000 bpd by the end of the year. The new deal, finalized around April, and Zhenhua’s leadership position at Bu Hasa had not been previously disclosed. The sources declined to be named, citing lack of authorization to speak to the media.

Neither Zhenhua nor TotalEnergies responded to requests for comment, while Adnoc stated it does not comment on commercial matters. In a move to deepen ties with Chinese partners, Adnoc opened a new office in Beijing in April. This development comes amid broader cooperation between Chinese energy companies and Adnoc, including LNG agreements and gas project contracts.

Founded in 2003 under the state defense conglomerate Norinco, Zhenhua focuses on oil and gas production outside of China, with assets in Iraq, Pakistan, and Kazakhstan. In 2018, it secured a 4% stake in Adnoc’s onshore concessions, joining major players like BP, TotalEnergies, and CNPC. With its increased offtake, Zhenhua is expected to become a more active trader of Abu Dhabi’s flagship Murban crude. The company, which operates trading desks in Beijing and Singapore, will also post its first crude trader in Abu Dhabi this month, according to the sources.