BP inks deal for onshore oil block in UAE

DUBAI, United Arab Emirates — BP PLC signed a $2.22-billion deal Saturday restoring its share of an onshore oil block in Abu Dhabi by agreeing to give the emirate stock worth 2 percent of the oil giant’s overall value.

The unique agreement spares BP of paying out cash and gives the capital of the United Arab Emirates stake in a company that first arrived there in 1939, when the country was still a British protectorate of sheikhdoms.

The deal also makes the UAE one of the biggest single stockholders in BP.

“This agreement will provide BP with long-term access to significant and competitive resources that we already understand very well,” BP CEO Bob Dudley said in a statement.

News of the deal came without warning Saturday after years of negotiations between London-based BP and Abu Dhabi, the capital of the seven sheikhdoms that form the UAE.

BP had held a 9.5-percent interest in the onshore concession that expired in late 2014. That year, the company’s overall crude production dropped 2.4 percent.

BP said Saturday’s deal includes the UAE’s Bab, Bu Hasa, Shah and Asab fields, which will produce between 20 billion to 30 billion barrels of oil equivalent over the 40-year term of the concession. BP will be entitled to 10 percent of its anticipated production of 1.66 million barrels of oil per day under the deal.