ADNOC Gas invests $2.1bn to advance LNG supply infrastructure

UAE’s ADNOC Gas said on Thursday it had awarded three contracts worth about $2.1bn for an LNG pre-conditioning plant (LPP), compression facilities and transmission pipelines to supply feedstock to the Ruwais LNG Project.

The Ruwais LNG plant will more than double ADNOC’s current 6 million tonnes per annum (mtpa) LNG capacity to over 15 mtpa, leveraging artificial intelligence (AI) and other innovative technologies to enhance safety, minimise emissions and drive efficiency.

The contracts were awarded to a consortium consisting of Engineering for the Petroleum and Process Industries (ENPPI) and Petrojet ($1.24bn for the LPP), China Petroleum Pipeline Engineering Company ($514m for transmission pipelines) and Petrofac Emirates ($335m for the development of new compression facilities).

“We are investing in world-class infrastructure and innovative technologies as we expand our capacity in LNG liquefaction and strengthen our position as a global player,” said Fatema Al Nuaimi, the CEO of ADNOC Gas.

The LPP and compression facilities will be located within ADNOC Gas’ Habshan 5 plant. The newly awarded transmission pipelines will connect the Habshan Complex with the Ruwais LNG facility.

ADNOC Gas said that the investments in the LPP, compression facilities, and transmission pipelines are not included in the capital expenditures (CAPEX) previously announced for its planned acquisition of ADNOC’s majority stake in the Ruwais LNG project.

However, the three contracts are part of the $15bn CAPEX that ADNOC Gas plans to invest through 2029.

The Ruwais LNG plant will more than double ADNOC Gas’ LNG production capacity to more than 15 mtpa once operational. The export facility will feature two liquefaction trains, each with a processing capacity of 4.8 mtpa, powered by clean grid electricity – a first in the Middle East region.

To date, more than seven mtpa of Ruwais LNG project’s production capacity has been committed to international customers through long-term agreements. ADNOC Gas has existing LNG supply deals with Germany’s EnBW, Japan Petroleum Exploration Company, TotalEnergies Gas and Power, and India Oil Corporation.

Meanwhile, ADNOC Group said that it sees significant value in a further ADNOC Gas share sale after a media report last November said the UAE energy giant was considering selling an additional 3-5 per cent stake sale in its gas unit.

The state-owned energy major said ADNOC Gas’ value could be enhanced by inclusion in wider market indexes and with a broader shareholder base.

Read: UAE’s ADNOC Gas boosts capex to $15bn on booming LNG market