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ADNOC AWARDS CONTRACTS WORTH $1.46 BILLION FOR HUGE DALMA SOUR GAS PROJECT

The two packages together represent one of the largest upstream EPC deals awarded by Adnoc this year. Abu Dhabi National Oil Company (Adnoc) has awarded contracts for two substantial onshore and offshore packages for its huge Dalma sour gas development in the United Arab Emirates.

Petrofac provided engineering, procurement, construction management and commissioning support services on the project.

The two contracts are together worth $1.46 billion and jointly represent one of the largest upstream engineering, procurement and construction projects awarded by Adnoc this year.

The EPC jobs have been awarded to local fabrication giant National Petroleum Construction Company (NPCC) and a grouping of Spain’s Tecnicas Reunidas and UAE’s Target Engineering, Adnoc said in a statement.

The first project (Package A) involves the offshore component and has been awarded to NPCC, valued at $514 million.

“It covers the EPC of four offshore wellhead towers, pipelines and umbilicals in Hair Dalma, Satah, and Bu Haseer fields,” the company said. The joint venture of Tecnicas Reunidas and Target Engineering won the second project (Package B) — which comprises the onshore facilities and is valued at $950 million.

The onshore contract covers the EPC of “gas conditioning facilities for gas dehydration, compression and associated utilities on Arzanah Island located 80 kilometres from Abu Dhabi,” Adnoc added.

Ghasha concession

The Dalma sour gas field is part of the giant Ghasha Concession that also includes the potential $20 billion Hail and Ghasha development that is being separately executed by the Emirati state-owned giant.

Adnoc's sour gas projects including Dalma and Hail and Ghasha are critical to the company's ambition to make UAE self-sufficient in domestic gas and also emerge as an LNG exporter in the long term.

Almost 70% of the Dalma “award value will flow back into the UAE economy,” in line with the company’s in-country value programme, Adnoc noted. Yaser Saeed Almazrouei, Adnoc’s upstream executive director said “the award of the Dalma EPC contracts as well as ongoing artificial island construction and development drilling underscore the progress of the Ghasha mega development”.

Almazrouei added the company is progressing “the Ghasha mega-development to maximise value as well as support the gas self-sufficiency goal of the UAE.”

The state-owned giant said both Dalma EPC packages are expected to be completed in 2025 and will enable the sour gas field to produce around 340 million cubic feet per day of gas.

Retender process

Petrofac last year won the onshore EPC package for Dalma involving the surface facilities, while the second package comprising the offshore facilities was awarded to the pairing of Petrofac and Sapura Energy. The two contracts awarded last year were together worth close to $1.65 billion.

However, Adnoc later cancelled the Dalma contracts following the coronavirus outbreak, as it aimed to further optimise costs for the sour gas project. The project was retendered later in 2020, as market fundamentals improved on the back of sustained higher crude prices. The offshore Dalma field is located about 190 kilometres northwest of the Emirate of Abu Dhabi.

© Sour Oil and Gas Advanced Technology 2021