Adnoc awards sour gas project Feed contracts
(1/10/2018 5:49:00 AM)
Abu Dhabi National Oil Company (Adnoc) today awarded two front-end engineering design (Feed) contracts for its planned offshore ultra-sour gas mega-project, which consists of the Hail, Ghasha and Dalma fields.
Bechtel was awarded the Hail and Ghasha Feed contract, and TechnipFMC the Dalma Feed contract. Both are worth hundreds of millions of dirhams, a statement said.
In man-hours, the two Feed contracts collectively are the largest ever awarded by an oil and gas company, underlining the significance of a detailed Feed phase to optimise project cost and schedule. The project, in the north-western area of offshore Abu Dhabi, could meet nearly 20 percent of the UAE’s gas demand by the second half of the next decade.
Dr Sultan Ahmed Al Jaber, UAE Minister of State and Adnoc Group CEO, said: "The growth in energy demand in Abu Dhabi and the wider UAE has prompted Adnoc to harness its gas resources as part of its 2030 transformational strategy. This Feed award provides Adnoc with further smart growth potential by unlocking our undeveloped sour gas reserves and will help us to deliver a key strategic imperative, which is to ensure a sustainable and economic gas supply."
In addition to awarding the Feed contracts, Adnoc is evaluating five technology licensors contracts, covering Gas Treatment Licensor; Sulphur Recovery Unit (SRU) Licensor; Natural Gas Liquids Licensor; Condensates Recovery - Hydro treaters - and Hydrogen Generation Licensor. These technologies are critical to the successful execution of the Feed phase.
Abdulmunim Saif Al Kindy, director of Adnoc’s Upstream business, said: "The decision to award the Feed contracts came after a rigorous and extremely competitive tendering process, ensuring we will strictly manage costs through working with contractors who can deploy effective engineering and robust value-add technologies. In progressing with these projects, we will create the potential to capitalise on our success and experience in ultra-sour gas production gained from the development of the Shah field, the largest project of its kind in the world."
From the start of the Feed phase, Adnoc, among very few companies in the world, will implement an Integrated Project Delivery (IPD) approach. This will enable it to reduce the project’s schedule and cost by integrating and involving all relevant stakeholders, including potential EPC bidders, sub-contractors, major manufacturers and governmental bodies during the Feed. These are critical to review design quality, identify design uncertainties and enhance the precision of required engineering jobs, the statement said.
In the Feed commercial evaluation process, the generation of in-country value, ICV, was considered as one of the selection criteria for the successful bidder. This validates Adnoc’s strategy to maximise in-country value and encourage all international partners to consider the ICV element in their future commercial strategy.
The Hail, Ghasha and Dalma project taps into Abu Dhabi’s Arab Formation, which is estimated to hold many trillions of cubic feet of recoverable gas. The project is expected to produce more than one billion cubic feet of gas per day, cfd, enough gas to provide to two million homes with electricity.
The awarding of the Feed contracts follows the awarding of the Project Management Consultancy and artificial island Design and Survey Contracts to Artelia and KBR, formerly Kellogg Brown and Root.