ABU DHABI - Part 3 - The Oil Exports & Logistics.

Abu Dhabi's exports of crude oil now average about 2 million b/d, In addition, its exports of refined oil products beyond Abu Dhabi and the UAE average 310,000 b/d, up from 95,000 b/d in early 1999. Before end-2005, Abu Dhabi's exports of crude oil could exceed 2.3m b/d. Exports of petroleum products will rise as well.

Crude oil exports in late February will rise back to a December average of more than 2.1m b/d, as a shut-in production capacity onshore will be re-activated after repairs to a gas facility (see profiles of Abu Dhabi's onshore and offshore fields in Part 2 of last week's Review).

About 60% of Abu Dhabi's oil exports go to Japan and a further 20% go to other Far Eastern markets. The Japanese market absorbs most of its exports of LNG and LPG. The capacity to produce LNG on Das island for export has more than doubled (see Gas Market Trends of this week).

Abu Dhabi's share of crude oil exports exceeds 1.2m b/d. This is tied up by term contracts handled by the Marketing and Refining Directorate of the Abu Dhabi National Oil Co. (ADNOC), which has been restructured (see who's who in Part 4).

Like most other NOCs of the Middle East, ADNOC seldom engages in spot trading. But its foreign partners in E&P ventures - such as BP, Total, Shell, ExxonMobil and Japanese companies - have established a spot market for Abu Dhabi crudes. Some of these companies also buy a part of ADNOC's share of oil production on term basis and trade the crudes on the spot market.

ADNOC has a pragmatic management authorised by the Supreme Petroleum Council (SPC) to widen and consolidate Abu Dhabi's share of the oil markets. It maintains direct relationships with refiners using Abu Dhabi crudes on both sides of Suez, including firms in which ADNOC has a stake acquired through the emirate's International Petroleum Investment Co. (see Downstream Trends).