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A drone attack has forced the suspension of operations at the Shah gas plant in Abu Dhabi, a site that supplies about 20 per cent of the UAE's gas supply and 5 per cent of the world's granulated sulphur.
“Operations at the facility have been suspended while damage is assessed, and no injuries have been reported,” Abu Dhabi Media Office said in a post on X.
World's largest ultra-sour operation
The gasfield, about 180km south-west of Abu Dhabi, is operated by Adnoc Sour Gas, a joint venture owned 60 per cent by Adnoc and 40 per cent by US energy major Occidental Petroleum.
The Shah gas plant is the “world’s largest” ultra-sour gas operation, with the capacity to produce 1.28 billion standard cubic feet of gas a day, according to its website.
Ultra-sour gas refers to natural gas that contains high concentrations (more than 23 per cent) of hydrogen sulphide and high levels of carbon dioxide, which is then processed to extract methane for energy and remove sulphur compounds.
The Shah plant includes gas processing units, with the gas delivered to Adnoc group companies for further processing or distribution to domestic consumers.
It also has the capacity to produce condensate, ethane and natural gas liquids.
The Shah plant also features a sulphur granulation plant with a capacity of about 4.2 million tonnes of sulphur a year. The site has four of the largest sulphur recovery units globally.
Adnoc Sour Gas is “the world’s largest producer of granulated sulphur”, producing about 5 per cent of the world's total production, according to its website.
That places Adnoc among the top three sulphur producers globally alongside Saudi Aramco and Gazprom, in a region that accounts for more than 30 per cent of world output.
A critical node in global sulphur supply
The sulphur is used primarily to manufacture phosphate-based fertilisers as well as produce sulphuric acid, which is used in manufacturing processes to produce items like rubber.
Granulated sulphur from Shah is transported by Etihad Rail to the Ruwais Terminal for export.
The plant's suspension is set to further strain the global fertiliser market, which is already reeling from the unofficial closure of the Strait of Hormuz.
The strait, apart from oil, was the conduit for about 30 per cent to 35 per cent of global nitrogen-based fertiliser exports, with about half of global urea originating in Gulf countries. Prices have risen 30 per cent since US and Israeli strikes on Iran last month severely disrupted shipping through the narrow waterway.
The downstream implications are significant. Adnoc holds an 86 per cent stake in Fertiglobe, the Middle East's largest fertiliser producer, with 6.6 million tonnes per year of urea and ammonia capacity across the UAE, Egypt and Algeria, after buying out OCI's 50 per cent share for $3.6 billion in 2024.
Beyond its own network, Shah's sulphur is a critical input for phosphate fertiliser producers globally, including major buyers such as OCP in Morocco.
Adnoc Sour Gas operates with an integrated single-field approach that covers upstream, midstream and downstream activities.
The gasfields were discovered in the 1960s, but were previously thought too difficult and too dangerous, both to human life and the environment, to develop.
The difficulties included dealing with underground temperatures of about 150°C, pressure of 5,500 pounds per square inch, designing plant and processes to “sweeten” the gas and recovery of sulphur on an unprecedented scale, as well as other processing and transportation issues to deal with the highly corrosive material over the expected 30-year life of the project.
However, with the growing demand for power in the country, Adnoc has accelerated the development of the project. In 2021, Adnoc awarded a $510 million contract to Italy's Saipem to expand production capacity at Shah.
The contract was aimed at increasing gas processing capacity at the Shah gas plant to 1.45 bcf/d.
Jennifer Gnana contributed to this report.
