Japan's Inpex wins 5 pct stake in new Abu Dhabi oil concession

(Recasts lead, adds detail, background)

By Yuka Obayashi and Rania El Gamal

TOKYO/ABU DHABI, April 27 (Reuters) - Japan's Inpex Corp became the first Asian oil company to get a stake in a new 40-year onshore oil concession in Abu Dhabi, joining France's Total (Swiss: FP.SW - news) in developing the United Arab Emirates' (UAE) biggest oilfields.

Nine Asian and Western companies bid for stakes in the Abu Dhabi Company for Onshore Oil Operations (ADCO) concession after a deal with the Western majors dating back to the 1970s expired in January 2014.

Abu Dhabi National Oil Company (ADNOC) said on Monday it had granted Inpex a 5 percent stake in the new concession.

The fields produce 1.6 million barrels per day (bpd) and output is expected to rise to 1.8 million from 2017.

Total became the first oil major to renew the concession, putting peers under pressure to improve terms after the local partner said the French firm made the best offer.

Last week, ADNOC's director general said there was no deadline for awarding further stakes in the concession, suggesting Abu Dhabi was in no rush to make a decision about other bidders in the tender.

The Inpex concession gives Japan, which imports almost all of its oil and is the fourth-biggest importer, the ability to procure oil without passing through the chokepoint of the Strait of Hormuz at the entrance to the Persian Gulf, Minister of Economy, Trade and Industry Yoichi Miyazawa told reporters.

"This is an epoch-making event and this pact will contribute greatly to Japan's stable procurement of oil," Miyazawa said.

It is the first major stake in an oil concession Japan has obtained since 2009. Japan holds stakes in oilfields producing 610,000 bpd and the ADCO concession will boost the figure by 15 percent when production is expanded to 1.8 million bpd.

Inpex did not disclose the value of the deal due to a confidentiality agreement, but Japanese public broadcaster NHK said earlier it was expected to be worth $1.1 billion.

Other bidders for the concessions include Occidental Petroleum Corp, Italy's ENI (NYSE: E - news) , China National Petroleum Corp, Norway's Statoil (Xetra: 675213 - news) and Korea National Oil Corp.

The concession signed with Total was effective from Jan. 1, 2015, and covers Abu Dhabi's 15 principal onshore oilfields that represent more than half of the Gulf emirate's production.

Four oil majors -- ExxonMobil, Royal Dutch Shell (Xetra: R6C1.DE - news) , Total and BP -- had each held 9.5 percent equity stakes in the ADCO concession since the 1970s.

After the deal expired last year, state-run ADNOC took 100 percent of the concession as political leaders in Abu Dhabi weighed up whether to bring in Asian firms or stick with old partners, industry and diplomatic sources said.

Shell (LSE: RDSB.L - news) and BP have also put in new bids, while Exxon has decided against bidding, sources have told Reuters.

For Japan, which imported 3.45 million bpd of oil in 2014, the UAE accounted for about 24 percent of the supply.

Inpex also owns a stake in the ADNOC's offshore oil concession, which is set to expire in 2018.

Japan's next challenge is to win a renewal of that stake.

"The deal on the onshore oil fields underlines a sense of trust in Japan by Abu Dhabi and could add momentum to our negotiation for the offshore concession," Ryo Minami, director at the oil and gas division at Agency for Natural Resources and Energy, told reporters.

Japan, which aims to boost self-sufficiency in gas and oil to 40 percent by the 2030 fiscal year, will raise the ratio to near 25 percent with the latest deal from 23.3 percent in the 2013/14 year. (Reporting by Yuka Obayashi and Osamu Tsukimori in TOKYO and Rania El Gamal in ABU DHABI; Editing by Richard Pullin, Alan Raybould and Mark Potter)