Abu dhabi - The Supreme Petroleum Council.

The SPC, in charge of the petroleum sector in Abu Dhabi, consists of key members of the ruling al-Nahyan family, representatives of the local Finance Department and ADIA, and the CEO of ADNOC bin-Yusuf who is the SPC secretary-general. It is chaired by Shaikh Khalifa bin Zayed, Abu Dhabi's ruler and UAE president, whereas when Shaikh Zayed was alive this was headed by the crown prince and chairman the EC who now is Shaikh Muhammad bin Zayed (see omt4AbuDwho'sJan26-09)

ADNOC initiates most of the decisions or projects, which must be approved by the SPC. ADNOC was restructured from October 1998 to mid-1999 (see Vol. 56, No. 4).

Decreed on June 5, 1988 by Shaikh Zayed, the SPC was preceded by a restructuring of ADNOC aimed at making it more efficient. That involved abolition of the Petroleum Department (local oil ministry) and ADNOC's board of directors. By eliminating both bodies, Shaikh Khalifa and his close aides ended a long power-struggle between Dr. Mana Sa'id al-Otaiba (till then heading the Petroleum Department), and Shaikh Tahnoun bin Muhammad, Shaikh Zayed's cousin and Shaikh Khalifa's father-in-law who is still the ruler's representative in the eastern province. The key SPC figures now are:

Shaikh Khalifa bin Zayed (see profile in Gas Market Trends).

Crown Prince and EC Chairman Shaikh Muhammad Bin Zayed.

Shaikh Sultan bin Khalifa, the ruler's first son.

Finance Department Chairman Shaikh Muhammad bin Khalifa, the ruler's second son.

Economy & Planning Dept. Chairman Nasser Ahmad al-Suwaidi.

ADNOC CEO & SPC Secretary-General Yusuf bin 'Umeir bin Yusuf.

UAE Deputy PM Shaikh Sultan bin Zayed.

ADNOC Deputy CEO and head of ADNOC E&P 'Abdullah bin Nasser al-Suwaidi.

Nasser Ahmad al-Suwaidi, ex-director of marketing at ADNOC, has been ADIC's managing director. In a local cabinet reshuffle decreed by Shaikh Khalifa on Dec. 19, 2006, the EC was expanded to 18 portfolios and Suwaidi was made chairman of the Planning and Economic Department.

The Abu Dhabi National Oil Co. (ADNOC) is in charge of implementing SPC decisions and forms the second tier of power. It has day-to-day authority over the petroleum sector in Abu Dhabi, deciding how SPC decisions must be executed.

ADNOC is in a position to advise and recommend to the SPC by using its experience - for example, by suggesting which is best among available options for a project.

ADNOC went through a massive restructuring process from October 1998 to mid-1999. The aim was to improve efficiency and prepare the company for future challenges. It has since become a holding concern conducting its business as an integrated entity, through eight autonomous directorates:

The E&P Directorate consists of four divisions: E&P Planning, Petroleum Resources, Onshore E&P and Offshore E&P. They have to "plan, guide and drive for the discovery and optimal development of Abu Dhabi's petroleum resources through exploration in own, joint venture or other concession areas", as determined by the SPC. Under this directorate come four operating units: the onshore ADCO, the offshore ADMA-OPCO, the offshore ZADCO, and National Drilling Co. (see profiles of the operating companies in Gas Market Trends No. 2). The head of this directorate is the deputy CEO of ADNOC, 'Abdullah Nasser al-Suwaidi, who is a member of the SPC.

The Gas Processing Directorate is in charge of the gas plants and JVs. Under it come the onshore NGL/LPG JV Gasco which in 2001 absorbed Abu Dhabi Gas processing Co. (Atheer), and the LNG joint venture ADGAS.

The Chemicals Directorate is in charge of the chemicals sector including the rapidly expanding Borouge olefins JV (60% ADNOC & 40% Borealis) and the fertiliser producer Fertil (see Downstream Trends No. 2).

The crude oil and products Marketing and Refining Directorate is in charge of sales, the Abu Dhabi Refining Co. (Takreer), and ADNOC for Distribution (ADNOC-FOD).

The Shared Services Directorate is the biggest of the five operating groups. Under it come the Abu Dhabi Drilling Chemicals & Products Co. (ADDCAP), Abu Dhabi Petroleum Ports Operating Co. (ADPPOC), Abu Dhabi National Tanker Co. (ADNATCO), National Gas Shipping Co. (NGSCs), National Marine Services Co. (NMS). This directorate also is in charge of providing the other groups with information technology (IT), project management, and procurement. The National Petroleum Construction Co. (NPCC - a JV with CCC) has been transferred to the Economy and Planning Department pending privatisation of the state's 70% stake in it.

The Human Resources and Administration Directorate. In February 1999, this directorate set up an eight-member Projects Steering Committee to monitor, evaluate, streamline co-ordination of, and endorse or approve ADNOC's major civil projects. Next come the The Management Support Directorate and The Finance Directorate. The latter three units come under the office of ADNOC's CEO, Yusuf bin 'Umeir bin Yusuf. ADNOC has an executive committee responsible for discussing and following up all company business. This is chaired by the company's CEO (see background in omt4AbuDwho'sJan24-05).

Whereas ADNOC-FOD's fuels are sold in Abu Dhabi at heavily-subsidised prices, in the other UAE emirates fuels are sold at market prices by three retail companies based in Dubai.

The three Dubai-based fuel retailers - Emirates National Oil Co. (ENOC), Emirates Petroleum Products Co. (Eppco) and the federal entity Emirates General Petroleum Corp (Emarat) - on Jan. 29, 2009, cut the price of diesel again, this time by Dh0.50 to Dh10.85/gallon, to reflect the decline in international oil prices at the local pumps. The three retailers buy diesel at international prices and then adjust the local prices, based on the landed price of the oil product. Diesel is widely used in the UAE as a transportation fuel and its prices have a direct bearing on inflation. These retailers had last cut diesel prices on Dec. 30, 2008. The latest cut marked their 14th successive reduction. On Jan. 29, paper WTI for March delivery traded a shade above $41 (Dh150.62) a barrel, down from $147.27/b on July 11, 2008.

The characteristics of ADNOC's executive structure have changed radically over the past two decades. When ADNOC began operations in early 1972, Algerian executives were in charge. But a clear shift occurred in the mid-1980s, leading to the formation of the SPC in 1988 and the departure of Algerian CEO Mahmoud Hamra-Krouha in the same year. Krouha and fellow Algerians in the management were replaced by young Abu Dhabian university graduates. The number of young Abu Dhabians joining the decision makers in ADNOC and other institutions has been increasing steadily over the past two decades (see the background in down4AbuDwho'sJan22-07).