LNG

Adnoc Gas, the natural gas and LNG producer in Abu Dhabi in the United Arab Emirates, has signed a 10-year supply agreement with GAIL India, the Indian pipeline gas and city-gas player whose facilities include the Dabhol LNG import terminal south of Mumbai.

Under terms of the deal, Adnoc Gas said it would supply GAIL with 500,000 tonnes per annum of LNG.

The latest Adnoc Gas agreement for LNG volumes follows similar deals signed with Japan Petroleum Exploration, France’s TotalEnergies, Indian Oil Corp. and PetroChina International.

Adnoc Gas, which was spun-off in March 2023 from Abu Dhabi National Oil Co. (ADNOC) to become a separate company, is estimated to have the seventh-largest gas reserves globally.

Step forward

“This long-term LNG supply agreement with GAIL India marks a significant step forward in our commitment to continue providing reliable and sustainable energy solutions to our partners and customers around the world,” said Ahmed Mohamed Alebri, Chief Executive of Adnoc Gas.

“India continues to be a key market for Adnoc Gas and this latest supply agreement underscores our ongoing dedication to fostering long-term partnerships,” added Alebri.

The main Adnoc Gas LNG operation is the the Das Island plant in Abu Dhabi with three liquefaction Trains and 6 MTPA of output.

The Das Island facility has operated since 1977 and was the first export plant established in the Arabian Gulf.

“Adnoc Gas continues to leverage opportunities arising from ADNOC’s integrated gas masterplan, which links every part of the gas value chain in the UAE,” said the company.

The ADNOC Group is leading the developments for the UAE that includes the new low-carbon Ruwais LNG export project currently under development in Al Ruwais Industrial City in Abu Dhabi.

Al Ruwais project

When completed, Al Ruwais will have two liquefaction Trains each with capacity of 4.8 MTPA for a total of 9.6 MTPA.

GAIL is a leading natural gas company in West Asia with a presence in India’s gas trading, transmission, city-gas and other sectors including petrochemicals.

The New Delhi-based company currently has a 75 percent share of the gas transmission network.

Its pipeline assets are 14,490 kilometres (9,000 miles) in length and GAIL makes about 50 percent of the country’s domestic natural gas sales.

GAIL has six subsidiaries including GAIL Global USA Inc., which looks after its Cove Point LNG interests in the state of Maryland.

The company also runs an LNG trading business based in Singapore.

Other assets include a majority stake in Konkan LNG, the ownership company of India's Dabhol LNG import terminal, located in the West Coast Indian state of Maharashtra, south of Mumbai, and with 5 MTPA of capacity.

European and Asian liquefied natural gas prices fell over the past week with the Dutch Title Transfer Facility benchmark declining by over 7 percent as European Union storage levels hit 100 percent and energy security concerns waned with cargo deliveries gathering pace and seasonal temperatures prevailed.

Technip Energies, the European LNG and energy project engineers, said their joint venture has been awarded an engineering, procurement, construction and commissioning (EPCC) contract by QatarEnergy for the onshore facilities of the North Field South Project (NFS) in the Arabian Gulf.

Technip said its partner for the award is the Middle East-based company Consolidated Contractors Company.

“This award will cover the delivery of two mega-Trains, each with a capacity of 8 million tonnes per annum,” said Technip.

The company added that the work would include a large carbon-capture and sequestration CCS) facility of 1.5 MTPA, leading to 25 percent-plus reduction of greenhouse gas emissions when compared with similar LNG facilities.

The NFS expansion project will produce about 16 MTPA of additional LNG, increasing Qatar’s total production from 110 to 126 MTPA after the North Field East (NFE) project is completed as well.

Mega-Trains

“We are extremely honored to have been awarded by QatarEnergy this mega-LNG project, along with our long-standing partner CCC, a leading construction company for LNG Trains,” explained Arnaud Pieton, Chief Executive of Technip.

“This award is a testament to the trust, extent, and strength of our relationship with QatarEnergy,” added Pieton.

“This new project also reflects our leadership in the LNG market as well as our proven ability to integrate technologies towards low carbon LNG, critical in solving the trilemma for affordable, available and sustainable energy,” declared the CEO.

Technip has been active with a local presence since 1986 in Qatar, which it described as “a strategic country” for the company.

Global LNG engineering firms like Technip are benefiting from the future forecasts of high demand for LNG cargoes. The company posted net profits of €320.2 million ($340.6M) for 2022 compared with €252.4M in 2021.

The company also had a contract backlog of €12.75Bln at the end of December 2022.

The company’s most recent plant to come on stream was the Coral South floating LNG hull that started up in November 2022 offshore Mozambique.

Abu Dhabi National Oil Company (Adnoc) has invited investment banks to pitch for roles in the initial public offering (IPO) of its natural gas business during the first half of 2023.

Several investment banks have been asked for proposals to act as joint global coordinators and bookrunners in the IPO to join New York-based Goldman Sachs as part of a planned banking syndicate, according to bankers familiar with the plans.

Adnoc is combining its gas-processing subsidiary with its main gas export unit, Adnoc LNG, into a single listed entity and has engaged Goldman Sachs as the principal bank to oversee the various transactions.

Adnoc plans to offer investors a minority stake in the new company through an IPO on the Abu Dhabi Securities Exchange in 2023.

Adnoc LNG was the first production company in the Arabian Gulf and processes feed gas at Das Island, located 160 kilometres (100 miles) off the coast of Abu Dhabi.

The LNG company also supplies one billion standard cubic feet of gas per day to the United Arab Emirates national grid, contributing to Adnoc’s commitment towards gas self-sufficiency in the UAE.

Current stakes

Adnoc LNG is majority owned by the Abu Dhabi-based firm with a 70 percent share of the company. The other shareholders are Japan’s Mitsui & Co with 15 percent, UK major BP with 10 percent and TotalEnergies with 5 percent.

Adnoc said late last month that the consolidation of the two entities would create one of the world’s largest gas-processing companies with a processing capacity of around 10 billion standard cubic feet per day.

Analysts note that Adnoc in the UAE and other nations in the region such as Qatar are overhauling their corporate capabilities to replace all Russian energy imports as early as mid-2024 as Western sanctions were imposed over the Russia's invasion of Ukraine.

The UAE is comprised of seven emirates and the leading energy emirate is Abu Dhabi, which also has the Ghasha mega-project, the world’s largest offshore sour-gas development. 

The emirates, outside of Abu Dhabi, have varying degrees of more limited energy resources in Dubai, Sharjah, Ajman, Umm Al-Quwain, Fujairah and Ras Al Khaimah,

The multi-billion-dollar Ghasha project will play a vital role in meeting the UAE’s gas self-sufficiency objectives.

Adnoc says that the Ghasha mega-project draws on its long-standing sour-gas expertise, including its Shah onshore ultra-sour gas field project, its pioneering work in the creation of artificial islands and the wide and deep sour-gas capabilities of its concession partners.

Adnoc is also currently unlocking potential unconventional gas resources as part of its integrated gas strategy and since late 2019 it has announced the discovery of 160 trillion standard cubic feet of recoverable unconventional gas.

Shell has been selected by QatarEnergy as a fifth partner in the North Field East expansion project in Qatar, described by Shell as the single largest project in the history of the liquefied natural gas industry.

Shell said it would hold a 25 percent share in a joint venture company which will own 25 percent of part of the North Field East project, including the four mega-Trains for processing a combined nameplate LNG capacity of 32 million tonnes per annum.

Shell said its investment in this LNG expansion would support delivery of much-needed supplies of natural gas to markets around the world.

“I am honoured that Shell has been selected by QatarEnergy. Through its pioneering integration with carbon capture and storage, this landmark project will help provide LNG the world urgently needs,” declared Shell Chief Executive Ben van Beurden.

“This agreement deepens our strategic partnership with QatarEnergy which includes multiple international partnerships such as the world-class Pearl GTL asset,” added Van Beurden.

“We are committed to maximize the value of the LNG expansion for the State of Qatar and continue to be a trusted, reliable and long-term partner in Qatar’s continued progress,” he stated.

ExxonMobil role

ExxonMobil Corp., the long-standing partner of Qatar in oil and gas and LNG, was chosen in June to be the fourth signatory of a joint venture stake in the North Field East expansion.

ExxonMobil, like Shell, was awarded a 25 percent interest in the fourth North Field East joint venture that will take QatarEnergy’s overall output to 110 million tonnes per annum from 77 MTPA.

The US major has had a presence in Qatar since 1955 and has long supported the development of the country’s LNG industry and energy sector.

QatarEnergy and ExxonMobil are also partners in the current transformation of the Golden Pass LNG import terminal on the Sabine-Neches Waterway in Texas into an export plant.

The terms for Qatar's NFE expansion joint ventures with Shell and ExxonMobil are the same as those given to the other three shareholders named earlier, France’s TotalEnergies, Italy’s Eni and US major ConocoPhillips.

The expansion of North Field East and increased LNG export capacity is one of Qatar’s key energy objectives.

QatarEnergy is the operator and commenced the North Field East project in 2019. First LNG from North Field East is expected in 2026.

The upstream part of the project is already under way to develop the southeast area of the North Field via eight platforms, 80 wells and gas pipelines to the onshore liquefaction plant.