Wednesday 18 July 2018

Four vie for UAE gas project

Abu Dhabi, July 10, 2007

Abu Dhabi has invited four international oil companies to bid in the revised competition for one of the largest projects this year open to companies vying for limited access to the Middle East energy sector.

ConocoPhillips, Exxon Mobil, Occidental Petroleum Corporation and Royal Dutch Shell were on the shortlist for the multi-billion dollar project to develop sour gas reserves at the Shah field, industry sources said yesterday.

The UAE is one of the few regional energy resource holders with projects available to international oil companies.

In Qatar, Kuwait and Iran, new projects are either on hold or stalled for political reasons.

Revised bids for the Shah field were due in by the end of August to state-run Abu Dhabi National Oil Company (Adnoc), industry sources said.

Adnoc is expected to choose a lead partner shortly after the new bids are submitted as it needs to bring online new gas supplies quickly to meet spiralling demand.

Record oil revenues have fuelled economic growth and boosted demand for gas from the power sector and heavy industry.

'They want to move ahead quickly,' said one source. 'They will really need the gas.' The winner will take a 40 per cent stake in the project, while Adnoc will hold the rest.

Industry sources were unable to give a cost estimate for the Shah development alone. The initial tender in April was to develop gas reserves in both the Shah and Bab fields and had an estimated cost of around $10 billion.

UAE Energy Minister Mohamed Al Hamli said the Bab field may be developed later.

Eight companies bid in April. The four that Adnoc has not asked to bid again for Shah are BP, Total, the Japan Oil Development and Wintershall, a subsidiary of German chemical company BASF.

The Shah field is potentially more attractive for Abu Dhabi to develop ahead of Bab due to its high levels of natural gas liquids, said Colin Lothian, senior analyst for the Middle East at global consultancy Wood Mackenzie.

Tags: abu dhabi | Royal Dutch Shell | Exxon Mobil | ConocoPhillips | Occidental Petroleum Corporation | Wood Mackenzie |

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