Abu Dhabi investing $25 bln in gas facilities

State-controlled Abu Dhabi Gas Industries Ltd (Gasco) said on Monday it is investing about $25 billion in gas-processing plants and pipelines as it develops more fields to meet surging demand.

"Two major gas-processing plants and around 10 new onshore gas pipelines covering a total of 1500 km are being built in and around Abu Dhabi over five to six years," Abdullah al-Darei, maintenance superintendant for the pipelines division at Gasco, said at an oil and gas conference in Abu Dhabi on Monday.

"The total cost will be approximately $25 billion," he said in the United Arab Emirates capital.

Gasco is 68 percent owned by Abu Dhabi National Oil Co (Adnoc), 15 percent by each of Royal Dutch Shelland Total, and 2 percent by Partex.

Gasco can process as much as 5.3 billion cubic feet per day of natural gas, though it is only operating at two-thirds capacity, Darei said, without explaining why.

The two planned gas-processing plants will be built at Habshan and Maqta, he said, without giving more details.

"New gas fields, like the Shah, with huge sour gas reserves, are being developed and additional gas-processing will be undertaken by Gasco," he said. "Rapidly growing demand for gas from industrial and other users has to be met."

Gasco operates 2,500 km of pipelines, moving gas and related products such as crude oil, condensates, natural gas liquids and water.
/Reuters/

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TAQA records remarkable profit growth in Q1

The Abu Dhabi National Energy Company TAQA today reported financial results for the first quarter 2008.

Since first quarter 2007 TAQA has made a number of acquisitions which have been fully or partially consolidated into the period under review. Following Q1'07, TAQA acquired CMS Generation, providing additional breadth to the company's downstream activities, while the acquisition of Northrock Resources and Pioneer Canada significantly increased TAQA's upstream assets. The largest company acquisition to date, PrimeWest, which was completed on 16 January 2008, is included in the company's financial results, herewith, for the first time. The effect of these acquisitions should be considered when making year-on-year comparisons.

Total revenue grew 279pc approaching AED 4.0 billion compared with AED 1.0 billion for the same period in 2007. Revenue from the electricity and water business grew by 38% to AED 1.2 billion, from AED 0.9 billion for the same period in 2007. This does not include supplemental fuel sales. Revenue from oil and gas activities accounted for AED 1.9 billion compared to AED 76 million for the same period of 2007. As at Q1'07, just two months of revenue from the assets acquired from BP Netherlands were included. The increase in Q1'08 was largely due to the acquisition of the TAQA North assets made since Q1'07. High average oil and gas prices experienced during the period have also been a contributing factor. Revenues derived from gas storage grew to AED 216 million compared with AED 72 million for the same period of 2007. This includes a full quarter of revenue from TAQA Energy as well as gas storage revenue from East Cantaur in TAQA North.

A statement from TAQA said that net profit (after minority interests) for the quarter grew 525pc to AED 398 million compared to AED 64 million in the same quarter in 2007. The increase is due to the acquisitions made since Q1'07, as well as the impact of high oil and gas prices experienced in Q1'08.

Peter Barker-Homek, Chief Executive Officer of TAQA, said: 'The results for the first quarter of 2008 tell a very different story to that of Q1'07 due to the acquisitions made during the year. Integration has been a major focus for the quarter, and for the first time we can begin to see the impact of the acquisitions we have made in the last year, including PrimeWest, the company's largest acquisition to date'.

During 2007, TAQA made strategic acquisitions that have transformed it into a global energy company comprised of quality energy assets. Today, TAQA operates in nine countries, and employs 2,800 people who come from 38 different nations. WAM

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Mubadala and PSN to establish PSN Emirates in Abu Dhabi

Mubadala Development Co. and Production Services Network (PSN) signed a joint-venture agreement to establish a new company in Abu Dhabi called PSN Emirates.

PSN Emirates will provide operations and maintenance contracting services to the upstream and downstream oil and gas industry. It will also provide services to onshore and offshore brown-field production facilities including engineering, procurement, construction, front end engineering design, project management, turnaround engineering management, and start-up management.

"The operating model of PSN Emirates is new to Abu Dhabi and the Gulf Cooperative Council region," said Waleed Al Mokarrab Al Muhairi, COO of Mubadala. "This approach, which has been successful in North America and the North Sea, brings a bold new chapter for the region's oil and gas industry."

PSN Emirates will be officially launched upon completion of formal establishment requirements. Source

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ConocoPhillips wins $10 bln plus gas project

ConocoPhillips has won a contract for a project expected to cost more than $10 billion to develop sour gas reserves in the United Arab Emirates, sources at state oil company ADNOC said on Thursday.

The project was one of the largest upstream projects in the past year open to international companies competing for limited access the Middle East's oil and gas fields.

"ConocoPhillips is the winner of the project," said one source at state-run Abu Dhabi National Oil Company (ADNOC), who declined to be identified. "The official signing (of the contract) will take place soon."

A second source at ADNOC also said Conoco had won the project. The company emerged as the front runner for the contract last month, beating competition from Exxon Mobil (XOM.N: Quote, Profile, Research), Occidental Petroleum and Royal Dutch Shell.

Conoco was expected to take a 40 percent stake in the project, while ADNOC would hold the rest.

Developing the sour gas at the Shah field would cost at least $10 billion, an industry source said on Thursday. Costs for the project have escalated, as they have worldwide in the energy sector as producers strain to bring new capacity online to meet rising demand.

Last year, analysts pegged the price of developing Shah and a second sour gas field called Bab at $10 billion. Now, the cost is as high for just the one field. (Reuters)

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Massive integrated gas development in Abu Dhabi

Abu Dhabi has launched the tendering process for the long-awaited onshore portion of its massive integrated gas development (IGD), which is aimed at significantly boosting the emirate's offshore gas production.

The objective of the multi-billion-dollar development is the production and transfer of more than 700 million cubic feet a day of high-pressure gas from the offshore Umm Shaif and Khuff reservoirs to new processing facilities at Habshan and Ruwais onshore.

A total of 25 local and international engineering, procurement and construction contractors have been invited to submit prequalification applications by 29 February for the five main onshore packages.

Four of the packages fall under the responsibility of Abu Dhabi Gas Industries Company (Gasco). The fifth will be tendered by Abu Dhabi Gas Liquefaction Company (Adgas).

Gasco's contracts are: package 1, covering the Habshan 5 gas processing plant; package 2, covering the Habshan plant's offsites and utilities element, including water and nitrogen provision; package 3, covering a fourth natural gas liquids (NGL) recovery train at Ruwais; and package 4, covering liquefied petroleum gas storage tanks at Ruwais.

Adgas's contract involves the construction of process units and utilities on Das Island, including a gas dehydration and compression facility.

In addition, Gasco is prequalifying local contractors for three civil works contracts, covering early works and non-process buildings at Habshan, and early works at Ruwais. A pre-tender meeting for all of the work will be held on 17 February.

The IGD's offshore portion is expected to be tendered later, with the work handled by Abu Dhabi Marine Operating Company (Adma-Opco). It covers the installation of a platform to be built adjacent to the Umm Shaif super-complex, and an associated gas transfer pipeline to Das island.

The additional gas from Umm Shaif and Khuff will be used as feedstock for industrial processes, as well as power generation requirements in Abu Dhabi and the northern emirates. The IGD project is also expected to deliver more than 10,000 tonnes a day (t/d) of NGLs and more than 4,000 t/d of sulphur. The whole project will take about four years.

The front-end engineering and design (FEED) contractor on the IGD is the US' Fluor Corporation. The US' KBR is the project management consultant for the FEED phase. Source

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