Securing the Abu Dhabi ADCO concession on an unusual forty-year contract (2015)

A long concession produced by half a century of presence

The heart of this decision lies not in one-off bidding tactics but in the fact that it moved only when an operating record built up since the 1970s combined with the government's resource diplomacy. That Japan obtained the allocation ranking behind Total appears to owe to years of trust on the ground that China and Korea did not have; the unusual forty-year term is legible as the product of accumulation rather than of a single act of negotiating strength. It was a case in which the government's target of raising the share of self-developed resources and a company's pursuit of a concession pointed the same way.

That said, a concession running forty years is exposed for exactly that long to commodity price swings and geopolitical risk. The ownership of the ADCO blocks has continued to shift since, with Chinese companies entering, and if the policies of the producing state or the international situation change, the standing of the interest can shift with them. What a long contract won on half a century of operating experience will mean over the next half century still depends on where resource prices and international relations go.