The Gas Rush: UAE awards $3.6bn contract to expand processing infrastructure
Business
Spanish firm has grabbed the investment opportunity
DUBAI (Reuters/Web Desk) – As countries from around the globe are rushing to secure energy security through long-term deals, the gas producers eye expanding their production facilities so that they can keep pace with demand.
Read more: UAE agrees to supply Germany with gas, diesel as Scholz tours Gulf
The United Arab Emirates is one of them as the state oil giant Abu Dhabi National Oil Company's gas unit, ADNOC Gas, said on Wednesday it awarded a $3.6 billion contract to expand its processing infrastructure in the country.
The contract was given to a joint venture between National Petroleum Construction Company Co PJSC (NPCC), owned by Abu Dhabi state fund ADQ, and Spain's Tecnicas Reunidas, ADNOC Gas said in a statement.
The new gas processing facilities will allow an "optimized supply" to the Ruwais Industrial Complex in Abu Dhabi's western Al Dhafra region.
Read more: A tale of two importers: Europe's record gas inventories, shortage in Pakistan
ADNOC Gas' Maximizing Ethane Recovery and Monetization project aims to boost ethane extraction by 35 per cent-40 per cent from its onshore facilities in the Habshan complex by building new processing facilities, as well as "unlock further value" from existing feedstock, delivering it to Ruwais through a 120-km (75 miles) natural gas liquids pipeline, the firm added.
ADNOC said over 70pc of the contract's value would "flow back into the UAE's economy".
Last month, the ADNOC announced a 14-year $7 billion to $9 billion deal with Indian Oil Corp to supply 1.2 million metric tonnes of liquefied natural gas (LNG) per year – one of the several long-term agreements signed with other countries.
At the same time, the ADNOC is expanding its portfolio and has approached German plastics and chemicals maker Covestro AG with a takeover proposal worth more than 10 billion euros ($10.9 billion), a person familiar with the matter said.
Read more: Abu Dhabi's ADNOC in almost $11bn approach for Covestro
Meanwhile, the Gulf State is also working on diversification of its economy as Prime Minister Fumio Kishida's recent visit to the Middle East led to a flurry of agreements for studies that Japan hopes will encourage key countries in the region to become hydrogen partners in a push for renewable energy.
