Identifier
Created
Classification
Origin
04ABUDHABI2028
2004-06-21 09:40:00
CONFIDENTIAL//NOFORN
Embassy Abu Dhabi
Cable title:
UAE: BOGUS REPORT CLAIMS EXXONMOBIL WINS BID TO
how-tonull Diana T Fritz 02/06/2007 05:35:51 PM From DB/Inbox: Search Results Cable Text: CONFIDENTIAL SIPDIS TELEGRAM June 21, 2004 To: No Action Addressee Action: Unknown From: AMEMBASSY ABU DHABI (ABU DHABI 2028 - ROUTINE) TAGS: EPET, PGOV, BEXP, ENRG, ECON, EINV Captions: None Subject: UAE: BOGUS REPORT CLAIMS EXXONMOBIL WINS BID TO DEVELOP UPPER ZAKUM Ref: None _________________________________________________________________ C O N F I D E N T I A L ABU DHABI 02028 SIPDIS CXABU: ACTION: ECON INFO: AMB DCM POL P/M Laser1: INFO: FCS DISSEMINATION: ECON CHARGE: PROG APPROVED: CDA: RALBRIGHT DRAFTED: ECON:CCRUMPLER CLEARED: NONE VZCZCADI440 RR RUEHC RUEHHH RUEHDE RUCPDOC RHEBAAA DE RUEHAD #2028 1730940 ZNY CCCCC ZZH R 210940Z JUN 04 FM AMEMBASSY ABU DHABI TO RUEHC/SECSTATE WASHDC 4791 INFO RUEHHH/OPEC COLLECTIVE RUEHDE/AMCONSUL DUBAI 4077 RUCPDOC/USDOC WASHDC RHEBAAA/DEPT OF ENERGY WASHDC
C O N F I D E N T I A L ABU DHABI 002028
SIPDIS
NOFORN
DEPT FOR NEA/RA, NEA/ARP, INR/EC, EB/IEP, EB/CBA
USDOE FOR INT'L AFFAIRS - COBURN, ALSO CALIENDO
USDOE FOR OFFICE OF THE SECRETARY - RHONDA HUDOME
USDOC FOR 1000/OC/
USDOC FOR 4520/ITA/IEP/ONE
USDOC FOR 4530/ITA/MAC/ONE/DGUGLIELMI
4500/ITA/MAC/DAS/WILLIAMSON
3131/CS/OIO/ANESA
E.O. 12958: DECL 06/21/2009
TAGS: EPET PGOV BEXP ENRG ECON EINV TC
SUBJECT: UAE: BOGUS REPORT CLAIMS EXXONMOBIL WINS BID TO
DEVELOP UPPER ZAKUM
REFS: 04 ABU DHABI 735 AND PREVIOUS
C O N F I D E N T I A L ABU DHABI 002028
SIPDIS
NOFORN
DEPT FOR NEA/RA, NEA/ARP, INR/EC, EB/IEP, EB/CBA
USDOE FOR INT'L AFFAIRS - COBURN, ALSO CALIENDO
USDOE FOR OFFICE OF THE SECRETARY - RHONDA HUDOME
USDOC FOR 1000/OC/
USDOC FOR 4520/ITA/IEP/ONE
USDOC FOR 4530/ITA/MAC/ONE/DGUGLIELMI
4500/ITA/MAC/DAS/WILLIAMSON
3131/CS/OIO/ANESA
E.O. 12958: DECL 06/21/2009
TAGS: EPET PGOV BEXP ENRG ECON EINV TC
SUBJECT: UAE: BOGUS REPORT CLAIMS EXXONMOBIL WINS BID TO
DEVELOP UPPER ZAKUM
REFS: 04 ABU DHABI 735 AND PREVIOUS
1. (U) Classified by Charge d'Affaires Richard A.
Albright, a.i., for reasons 1.5 (B) and (D).
2. (U) A Middle East Economic Survey (MEES) article this
week, citing "sources close to the Supreme Petroleum
Council" (SPC),claimed that the SPC had selected U.S. firm
ExxonMobil to develop the mammoth Upper Zakum oil field in
Abu Dhabi. The article, reported widely in the
international press, said that the SPC had made its choice
three months ago, but delayed announcing the decision
because of "political sensitivities." ExxonMobil,
ChevronTexaco, BP, Shell, and TotalFinaElf submitted bids
in 2002 for a 28 percent equity stake in the Zakum
Development Company (ZADCO),which manages the Upper Zakum
oil concession -- one of the world's largest offshore
reservoirs. The SPC short listed ExxonMobil, Shell and BP
in January 2004 for a final round of negotiations (refs).
3. (C/NF) ExxonMobil President in the UAE Frank Kemnetz
(please protect) told Econoff that the articles were a
total surprise. Exxon had just completed a due diligence
study at ADNOC's request the week before and, from Exxon's
perspective, the competition for Upper Zakum remained "wide
open." ADNOC executives confirmed to Kemnetz that the
articles were incorrect, and that the company expected the
final round of negotiations to take another four months to
complete. On June 21, the SPC released a statement denying
the report carried by the international press, calling it
"unfounded and baseless." The SPC confirmed that the
competition between the three firms is ongoing.
4. (C/NF) Comment: While premature in announcing a
decision on Upper Zakum, the articles are consistent with
what we have heard privately from ADNOC and SPC officials.
ADNOC officials and senior shaykhs have suggested for many
months that ExxonMobil's technical package is the most
impressive -- combining first-class managerial expertise
with proprietary technology and a commitment to train and
employ UAE nationals. Kemnetz did not perceive that the
press articles would hurt Exxon's chances of sealing the
deal (ADNOC execs probably realize that the leak came from
within their own organization),but the articles provide
ammunition to critics who say the Upper Zakum bidding
process has lacked transparency from the start. We expect
to see public declarations from ADNOC and SPC officials
reassuring BP and Shell that they are still in the race,
but we are confident that ExxonMobil's position remains
strong. End comment.
Albright
SIPDIS
NOFORN
DEPT FOR NEA/RA, NEA/ARP, INR/EC, EB/IEP, EB/CBA
USDOE FOR INT'L AFFAIRS - COBURN, ALSO CALIENDO
USDOE FOR OFFICE OF THE SECRETARY - RHONDA HUDOME
USDOC FOR 1000/OC/
USDOC FOR 4520/ITA/IEP/ONE
USDOC FOR 4530/ITA/MAC/ONE/DGUGLIELMI
4500/ITA/MAC/DAS/WILLIAMSON
3131/CS/OIO/ANESA
E.O. 12958: DECL 06/21/2009
TAGS: EPET PGOV BEXP ENRG ECON EINV TC
SUBJECT: UAE: BOGUS REPORT CLAIMS EXXONMOBIL WINS BID TO
DEVELOP UPPER ZAKUM
REFS: 04 ABU DHABI 735 AND PREVIOUS
1. (U) Classified by Charge d'Affaires Richard A.
Albright, a.i., for reasons 1.5 (B) and (D).
2. (U) A Middle East Economic Survey (MEES) article this
week, citing "sources close to the Supreme Petroleum
Council" (SPC),claimed that the SPC had selected U.S. firm
ExxonMobil to develop the mammoth Upper Zakum oil field in
Abu Dhabi. The article, reported widely in the
international press, said that the SPC had made its choice
three months ago, but delayed announcing the decision
because of "political sensitivities." ExxonMobil,
ChevronTexaco, BP, Shell, and TotalFinaElf submitted bids
in 2002 for a 28 percent equity stake in the Zakum
Development Company (ZADCO),which manages the Upper Zakum
oil concession -- one of the world's largest offshore
reservoirs. The SPC short listed ExxonMobil, Shell and BP
in January 2004 for a final round of negotiations (refs).
3. (C/NF) ExxonMobil President in the UAE Frank Kemnetz
(please protect) told Econoff that the articles were a
total surprise. Exxon had just completed a due diligence
study at ADNOC's request the week before and, from Exxon's
perspective, the competition for Upper Zakum remained "wide
open." ADNOC executives confirmed to Kemnetz that the
articles were incorrect, and that the company expected the
final round of negotiations to take another four months to
complete. On June 21, the SPC released a statement denying
the report carried by the international press, calling it
"unfounded and baseless." The SPC confirmed that the
competition between the three firms is ongoing.
4. (C/NF) Comment: While premature in announcing a
decision on Upper Zakum, the articles are consistent with
what we have heard privately from ADNOC and SPC officials.
ADNOC officials and senior shaykhs have suggested for many
months that ExxonMobil's technical package is the most
impressive -- combining first-class managerial expertise
with proprietary technology and a commitment to train and
employ UAE nationals. Kemnetz did not perceive that the
press articles would hurt Exxon's chances of sealing the
deal (ADNOC execs probably realize that the leak came from
within their own organization),but the articles provide
ammunition to critics who say the Upper Zakum bidding
process has lacked transparency from the start. We expect
to see public declarations from ADNOC and SPC officials
reassuring BP and Shell that they are still in the race,
but we are confident that ExxonMobil's position remains
strong. End comment.
Albright