Adnoc to pick more partners for Ghasha ultra-sour gas concession

The Abu Dhabi state-owned company had awarded Eni of Italy a 25% stake to develop the reserves

Dr Sultan said plans were underway to expand Adnoc’s carbon capture utilisation and storage programme, launched in 2018 by six-fold over the next decade.. Adnoc

Abu Dhabi National Oil Company is set to take on new partners for the development of its Ghasha ultra-sour gas concession after awarding Eni of Italy a 25 per cent stake to develop the reserves.

"More significant announcements are in the pipeline as we focus on maximising value from all our resources and unlocking increased and commercially viable production from our oil and gas reserves," said Dr Sultan Al Jaber, Adnoc chief executive officer in a statement on Monday.

Ghasha concession is Adnoc’s offshore ultra-sour gas mega project, consisting of Hail, Ghasha, Dalma and other offshore fields. Sour gas fields contain a high level of sulphur that needs to be extracted to produce gas for consumption. Adnoc is in talks with other potential foreign oil and gas companies to award the remaining 15 per cent stake, with the state-owned producer retaining a 60 per cent holding.

Adnoc awarded French oil major Total a 40 per cent stake in an unconventional gas concession and has received interest from other foreign oil and gas firms to develop these reserves.

The UAE is increasingly pivoting to gas as it frees up more crude for exports. Abu Dhabi’s Supreme Petroleum Council approved a five-year capital expenditure plan of Dh486 billion for the state-run company to increase capacity and unlock its sour gas caps, as well as develop and acquire downstream capabilities at home and abroad.

The Emirates, which accounts for 3.1 per cent of global proven reserves of natural gas, announced it had found 15 trillion cubic feet of gas in existing and untapped blocks last week. The discoveries will add 7.1 per cent to existing reserves of gas, which stood at around 209.7 trillion cubic feet at the end of 2017, according to the latest BP Statistical Review of World Energy.

The discoveries will help the company keep producing liquefied natural gas, or gas cooled to liquid to be transported by ships, to 2040 and allow the emirate to achieve gas self-sufficiency.

Adnoc extended its gas supply agreement with subsidiary Adnoc LNG until 2040, replacing an earlier deal expiring in the first quarter of 2019.

The Adnoc unit has signed seven agreements for the sale of over 4.2 million tonnes of LNG annually, with a growing emphasis on locking shorter-term contracts to respond to growing demand for the cleaner fuel, it said earlier this month.

Adnoc also plans to award its first licensing round for oil and gas in the first quarter of next year, offering up to six blocks for international companies.

The national oil company, which aims to increase oil production capacity to 4 million barrels per day by 2020 and 5 million bpd by 2030, also announced an Dh5.1bn investment plan to upgrade and expand its Bu Hasa field, which will increase crude oil production capacity by 18 per cent to 650,000 bpd.

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Adnoc announced a string of deals and agreements during the Abu Dhabi International Petroleum Exhibition and Conference that took place in the capital last week. The oil and gas company signed an agreement with Saudi Aramco, the world’s biggest crude producing company, to explore investments in natural gas and LNG as the two look to expand their revenue base.

Adnoc also joined hands with Abu Dhabi’s strategic firm Mubadala Investment Company to explore downstream investment opportunities across the globe.

It also signed a deal with the state-backed Indian Strategic Petroleum Reserves to store its crude at the firm’s underground oil storage facilities in India.

“Our Adipec announcements are only the beginning of our next phase of rapid growth,” Dr Al Jaber said.