Energy & Mining

Explosive Demand

Abu Dhabi’s Gas Sector

During the last few years the UAE has increased gas development, to help satisfy growing domestic demand.


Abu Dhabi has budgeted approximately $25 billion for LNG development. The Emirate’s rising gas need prompted ADNOC to embark on the greenfield Al Hosn Gas Plant project to exploit the sour gas of the Shah Gas Field, which had been too sulfurous for conventional production. And as a result, the Emirate, home to gigantic infrastructure projects in recent years, is poised to add another in the LNG subsector when Emirates LNG builds the world’s largest receiving facility. With a maximum capacity of 9 million tons, this behemoth will serve as a facility for re-gasifying imports. With the ball commercially rolling in 3Q2014 it boasts a daily capacity of roughly 500 million cubic feet of gas, plus associated natural gas liquids and 9,000 tons of sulfur.


In an outwardly ironic twist, the UAE has some 215 trillion cubic feet of natural gas reserves, ranking it the seventh largest globally, yet due to ongoing export agreements is actually a net importer. Annual production of 7.9 billion standard cubic feet per day leaves the UAE. Yet, because domestic industry has increasingly turned to natural gas as its principle energy input, demand has been economically met from neighboring Qatar since 2007 via the Dolphin Pipeline Project, a $7 billion regional energy network involving the UAE, Qatar, and Oman. The Dolphin processing plant, awarded to JGC Middle East FZE, a subsidiary of JGC Corporation of Japan, came online in late 2006. The 1.2 meters diameter, 364 kilometer sub-sea pipeline is daily envisaged to deliver up to 2 billion cubic feet of Qatari natural gas (max. capacity 3.2 billion cubic feet a day [cf/d]) over a quarter century period. The constructor and operator of the entire scheme is Dolphin Energy, 51% owned by Emirati investment and development company Mubadala, mandated by the government of Abu Dhabi to diversify the Emirate’s industrial matrix and implement social projects. The large international oil entities active in the UAE’s oil and gas sector include BP, Shell, Total, ExxonMobil, and US Occidental Petroleum. The latter won plaudits in 2008 for bagging the first concession extended by the UAE in over 20 years.


Budgeted at $11.3 billion and due for completion in 4Q2014, Abu Dhabi’s Shah field gas development project is geared at daily production of up to 1 billion cf/d of gas in contribution to client ADNOC’s overall target of 6 billion cf/d. Of note, related gas will largely fuel newly installed power, desalination, and petrochemical plants in the Emirate. Yet gas will also be re-injected into local oil fields to ensure adequate reservoir pressure. Shah field gas output will also be purified of its high sulfur content, which will be sent for processing and distribution at the Habshan and Ruwais facilities.


This scheme, priced at $11 billion and belonging to Abu Dhabi Gas Industries (Gasco), involves the production and transfer of high-pressure gas of 700 million cf/d from the offshore Umm Shaif and Khuff reservoirs to newly-constructed onshore processing facilities at Habshan and Ruwais via Das island. Related gas is set to increase overall gas flow from Das Island to Habshan to 1 billion cf/d and satisfy the fuel need of power stations and other industrial consumers in Abu Dhabi and the northern Emirates. Supplementary to the high-pressure gas itself, the project is scheduled to deliver 12,000 tons of liquid natural gas and 5,000 tons of sulfur per day.