Adnoc Gas awards $2.1bn in contracts for LNG infrastructure

Move is part of Abu Dhabi company's $15bn capital expenditure plan

Adnoc's Ruwais LNG complex is expected to become operational in 2028. Photo: Adnoc

Adnoc Gas has awarded three contracts worth $2.1 billion to grow infrastructure supporting its Ruwais LNG Project amid rising demand for liquefied natural gas globally.

The contracts include a $1.24 billion agreement for an LNG preconditioning plant at the Habshan 5 facility, awarded to a consortium with Egypt's Enppi (Engineering for the Petroleum and Process Industries) and Petrojet, Adnoc Gas said on Thursday.

A $514 million contract for transmission pipelines was secured by China Petroleum Pipeline Engineering, while Petrofac Emirates was awarded a $335 million contract to develop compression facilities.

The contracts aim to establish the infrastructure needed to supply feedstock to the Ruwais LNG export complex, the company said.

The Ruwais LNG centre, expected to become operational in 2028, is set to more than double the company’s liquefied natural gas production capacity to over 15 million tonnes a year.

“The awards … underline our commitment to making strategic and targeted investments that enable the delivery of our most significant projects, allowing us to continue meeting our customers' demands internationally,” said Fatema Al Nuaimi, chief executive of Adnoc Gas, the integrated gas processing unit of Abu Dhabi National Oil Company.

In November, Adnoc Gas said it expects to acquire parent company Adnoc’s 60 per cent stake in the Ruwais LNG plant in the second half of 2028 for up to $5 billion.

The project, partly owned by international energy companies such as BP, Japan’s Mitsui, Shell and TotalEnergies, will significantly increase Adnoc Gas's LNG production capacity.

Its Habshan 5 plant is part of one of the world’s largest integrated gas processing complexes. The five plants have a combined capacity to process 6.1 billion standard cubic feet of gas a day.

The newly-awarded transmission pipelines will connect the Habshan complex with the Ruwais LNG facility, the company said.

The latest awarded projects, part of Adnoc Gas’ $15 billion capital expenditure plan through 2029, aim to strengthen its position as a global LNG supplier while leveraging clean grid electricity to minimise carbon intensity.

Adnoc Gas supplies to customers in the Emirates, mostly utilities and industrial companies, through an extensive network of pipelines. Photo: Adnoc

The Abu Dhabi-based company, which has access to 95 per cent of the UAE's natural gas reserves, supplies customers in the Emirates through an extensive network of pipelines. It also seeks to grow exports of products such as LNG, liquefied petroleum gas and naphtha.

Global LNG demand is estimated to rise by more than 50 per cent by 2040, as industrial coal-to-gas switching gathers pace in Asia and South-East Asian countries. Such countries use more LNG to support their economic growth, Shell said last year.

Last month, Adnoc signed a sales and purchase agreement with German energy infrastructure company EnBW to supply 600,000 tonnes per annum of LNG for 15 years. The LNG will primarily be sourced from the Ruwais LNG project.

The agreement with EnBW is Adnoc’s second with a German company for Ruwais LNG, after a 15-year, 1 mtpa deal signed in November with state-owned energy company SEFE.

More than 8 million tonnes per annum of the Ruwais LNG project’s 9.6 mtpa production capacity has been committed to international customers through long-term deals, the company said in December.