Oil in Abu Dhabi: A Brief History of the Industry

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Abu Dhabi, capital of the United Arab Emirates (UAE), holds 94 percent of the country’s oil reserves, and about 9 percent of the entire world’s. The populous region’s oil industry has transformed the city it from a poor fishing town into one of the richest cities on the planet.

The industry began to show glimmers of promise after the decline of the city’s pearl trade, when an agreement to start exploration for oil was made in 1936. The Petroleum Development (Trucial Coast) signed this agreement with the ruler at the time, Sheikh Shakhbut.

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In 1939, a seventy-five-year concession was signed with a number of foreign oil companies (FOCs), but things were far from smooth sailing: WWII stalled the operation for years, and local communities suffered from economic hardships, malnutrition and disease.

Gravity surveys finally began in 1946, but stalled in 1950 when the region’s desert terrain and sand dunes proved too much for exploration vehicles. Then, a drilling attempt of Ras Sadr turned up dry, and more drilling off the seismic coast had to be plugged and abandoned.

It wasn’t until 1958 (on the Umm Shaif field) and 1959 (Merban No. 3, later named Bab) that drillers struck commercially viable oil. Oil production and exports started in 1962 and 1963; after 1966 the city amassed enough wealth to transform the region and support the formation of the UAE in 1971.

In 1971, the state-controlled Abu Dhabi National Oil Company (ADNOC) was formed, strategically aligned with Western oil companies like Exxon, Shell and BP. Two oil refineries opened by ADNOC in the early 1979 and 1981, making the UAE entirely self-sufficient in petroleum production.

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Western alliances helped bring Abu Dhabi the best technology for decades more of momentous discoveries. The original concession ended in 2014, so ADNOC is currently allowing the original foreign oil companies it partnered with to continue working before all FOC bids are evaluated and new agreements are reached.

Though the heyday of oil discovery may be over for the time being, expansion continues. Today Abu Dhabi has the sixth largest proven oil reserves (92 million barrels), and remains the eighth biggest oil producer in the world, with an output roughly 3 million barrels per day.

Abu Dhabi Bio Jet Fuel Project Nears Test Stage

Abu Dhabi seeks to make a move towards a more community conscious airport in Renton, Washington. Boeing, in works with Etihad Airways has been working on developing a biofuel in emirate since early 2014. The goal is to produce a more environmentally friendly jet fuel that their airlines can implement and utilize in all of their planes

The counterparts are looking to expand the production of this bio fuel’s use as it nears it’s testing stage. Boeing and Etihad Airways have started construction for the fuel producing plant on a one-acre trial farm location. In Abu Dhabi, a plant called salicornia bigelovii generates oil that can be used to make the biofuel so it will be planted in the test farm. A Boeing executive says that the plant is expected to be completed in the next three to four months.

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The team expects a relatively soon turn around because they’ve also been in the works with Abu Dhabi National Oil Company’s Takreer and the Masdar Institute and Total.

Julie Felgar, Managing Director, Environmental Strategy and Integration at Boeing Commercial Airplanes, informed reporters that the new bio fuel will be put to the test soon. A small pilot project will run after the test farm’s construction is through and complete.

“We’ll take one year to 18 months to run through a couple of harvest rotations and see what the opportunities are in being able to scale that up,” Felgar told reporters.

This environmentally focused project is a great addition to Boeing’s arsenal. But Boeing is majorly active in this particular industry as The Abu Dhabi project is just one of 19 global biofuel projects underway for the organization. Their team has the inherent focus to develop jet aviation fuel based on biological processes like agriculture or waste in route to reducing the industry’s carbon footprint.