meed-logo

line1 line2 line3
SIGN IN / REGISTER

Adnoc spurs downstream gas expansions

13 October 2023

This package on the UAE’s downstream sector also includes: 

> Adnoc Gas picks site for planned LNG terminal
> Adnoc Gas receives prices for Estidama package
> Adnoc and Dusup sign key gas supply agreement
> Adnoc receives bids for gas pipeline packages
> Adnoc receives prices for sales gas pipeline packages
> Adnoc Gas awards $3.6bn Project Meram contract

 

Demand for natural gas has risen exponentially in this decade, with its share in the global energy mix set to grow further in the decades to come.

Regional energy producers are deploying major capital expenditure programmes to increase their gas production and processing capabilities to cater to growing demand.

The UAE is striving to achieve self-sufficiency in gas production by 2030. With this objective in mind, Abu Dhabi National Oil Company (Adnoc) has committed significant investment towards expanding its midstream and downstream gas capabilities.

These projects seek to increase the availability of gas for utility providers and industrial customers in the UAE and ramp up ethane output to grow the country’s petrochemical sector and its derivatives ecosystem.

Hail and Ghasha galvanises UAE upstream market

Ruwais LNG project

Adnoc Gas, the gas processing business of Adnoc, has finalised the location for its planned liquefied natural gas (LNG) export terminal. The facility will have the capacity to produce about 9.6 million tonnes a year (t/y) of LNG from two processing trains, each with a capacity of 4.8 million t/y.

The overall value of the planned project is estimated to be upwards of $4.5bn, based on capital expenditure by operators on similar schemes worldwide.

Adnoc Gas received technical bids from contractors in May for the engineering, procurement and construction (EPC) works on the project, which will be built in Ruwais Industrial City in Abu Dhabi’s Al-Dhafrah region.

Adnoc Gas had originally planned to build the LNG terminal in the UAE emirate of Fujairah, which sits outside the Strait of Hormuz on the coast of the Gulf of Oman. In early May, however, the company announced it was shifting the location of the project from Fujairah to Ruwais, Abu Dhabi.

Sales gas pipeline network

Adnoc Gas is progressing the Estidama project, which is crucial to enhancing Adnoc’s sales gas pipeline network across the UAE. The project aims to cater to rising demand for gas from industrial consumers across the UAE, particularly in the Northern Emirates.

Contractors submitted commercial bids in August for combined package numbers 4 and 7. The combined package involves laying a new pipeline from the Al-Shuwaib pig launcher and pig receiver station to the Sajaa gas facility in Sharjah.

The scope also covers building a new gas pipeline between BVS-2/KP28.7 in Abu Dhabi to Dubai’s Margham gas facility to meet increased gas demand from Adnoc Gas’ customer Dubai Supply Authority (Dusup).

EPC works on the estimated $2bn-plus Estidama project have been divided into seven packages. Abu Dhabi-based contractor Integrated Specialised General Contracting Company (Iscco) won package 1, understood to have a contract value of $18m, in December 2021.

In early July, Adnoc Gas awarded contracts worth a combined $1.34bn for two other packages of the Estidama project. UK-headquartered Petrofac was awarded the EPC contract for package 2 of the Estidama project, estimated to be worth $720m.

A consortium of Abu Dhabi’s National Petroleum Construction Company (NPCC) and Lebanon-headquartered CAT Group won Estidama package 3, which is valued at about $630m.

Contractors submitted technical bids for package 6 in August 2022 and commercial bids by 21 November. Work on package 6 entails the installation of a 52-inch, 74-kilometre pipeline from Sweihan to Al-Shuwaib in Abu Dhabi and building two block valve stations.

Package 5 is expected to be tendered separately to contractors as part of a planned second phase of the sales gas pipeline upgrade project.

As per the original project schedule, EPC works on the Estidama project are due to be completed in 2025.

Ramping up ethane output

Adnoc Gas is in charge of one of the world’s largest gas processing complexes in Abu Dhabi, with the capacity to process about 8 billion cubic feet a day from its Asab, Bab, Bu Hasa, Habshan and Ruwais plants.

Increased volumes of ethane production will allow the company to commercialise it to supply feedstock to Borouge for its under-construction Borouge 4 petrochemicals complex, as well as to derivatives plants in the upcoming Taziz complex. Adnoc Gas intends to achieve this through the Maximise Ethane Recovery & Monetisation (Meram) project.

Adnoc Gas awarded a $3.6bn contract for Project Meram to a consortium of NPCC and Spanish contractor Tecnicas Reunidas in early August, with EPC work on the project starting later that month. The scope of work on the contract includes commissioning new gas processing facilities to enable an optimised supply to the Ruwais industrial complex, Adnoc Group said.

The strategic Meram project aims to achieve dual objectives, Adnoc stated.

The first goal is to increase ethane extraction by 35 to 40 per cent from Adnoc Gas’ existing onshore facilities in the Habshan gas processing complex by constructing new gas processing facilities.

The second goal is to unlock further value from existing feedstock and deliver it to Ruwais via a 120km natural gas liquids (NGL) pipeline.

LATEST NEWS FROM THE UAE's CHEMICALS SECTOR:
> Lummus seeks to expand Abu Dhabi office
> Firms express interest for Abu Dhabi methanol project
> Borouge and Borealis launch recycled products range
> Fertiglobe makes $84m profit in second quarter
> Borouge announces $231m profit in second quarter
> Adnoc opens formal chemicals integration talks with OMV

Taziz chemicals complex

Meanwhile, investors in the Taziz petrochemicals derivatives-producing industrial complex in Ruwais are pushing ahead with their projects.

Taziz – a 60:40 joint venture (JV) of Adnoc and Abu Dhabi’s industrial holding company ADQ – is overseeing the development of the sprawling industrial complex, which will mainly draw ethylene feedstock from the Borouge 4 facility to produce several in-demand chemicals.

A JV of UAE-based Fertiglobe, South Korea’s GS Energy and Japanese investment firm Mitsui awarded Italian contractor Tecnimont the main EPC contract for its planned blue ammonia project in the Taziz Industrial Chemicals Zone in February.

The JV has appointed KBR to provide the technology licence, basic engineering design, proprietary equipment and catalyst for the low-carbon ammonia plant, which will have a capacity of 1 million t/y.

India’s Reliance Industries is also an investor in the Taziz complex, having forged a partnership with Taziz and Abu Dhabi-based Shaheen Chem Holdings Investment to invest $2bn in developing three chemical plants producing chlor-alkali (940,000 t/y), ethylene dichloride (1.1 million t/y) and polyvinyl chloride (360,000 t/y).

Switzerland-based Proman has committed to building the UAE’s first methanol plant at Taziz, with a planned production capacity of 1.8 million t/y. The Proman-Taziz JV completed the contractor prequalification process for the EPC tendering round for the methanol production project in August. The operator is expected to issue the main EPC tender later this year.

As projects in the first phase of the chemicals complex move forward, Taziz is also understood to be gearing up for a second phase to more than double the number of chemicals produced at the derivatives hub.

https://image.digitalinsightresearch.in/uploads/NewsArticle/11214144/main.jpg
Indrajit Sen

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Kuwait awards $381m oil project

    23 September 2026

    Register for MEED’s 14-day trial access 

    State-owned upstream operator Kuwait Oil Company (KOC) has awarded an oil project contract worth KD117m ($381m) to India’s Megha Engineering & Infrastructure (Meil).

    The Supreme Purchasing Committee for Kuwait Petroleum Corporation (KPC) approved the contract last month, paving the way for the official award.

    The project focuses on a water separation unit at the Al-Rawdatain facility in Kuwait.

    The water separation facility will be developed at Gathering Centre 25 (GC-25), along with a pumping facility at GC-30.

    The project will deliver a wide-ranging upgrade of processing and utility infrastructure, including new low-pressure separation and gas-handling equipment such as a three-phase wet separator package, a gas knock-out drum and associated low-pressure gas pipelines, as well as a high-integrity pressure protection system and a high-pressure flare.

    Meil will develop the new three-phase low-pressure wet separation facility at GC-25.

    The main process equipment will include two wet separator packages, each with a capacity of 150,000 barrels of liquid a day, and a low-pressure gas knock-out drum with a capacity of 53 million standard cubic feet a day, together with associated gas-handling facilities.

    The facility will also incorporate an effluent water treatment and transfer system, including an effluent water balance tank equipped with microbubble flotation and induced gas flotation systems, as well as transfer pumps.

    Additional GC-25 facilities will include fuel gas treatment, chemical injection, oil recovery and flare connections, along with firewater and deluge systems.

    The scope also covers control and safety systems, substations, and associated civil, structural, mechanical, electrical and instrumentation works.

    At GC-30, the project will focus on treated-water filtration and high-pressure injection infrastructure.

    The scope includes nutshell filters and associated feed pumps with a combined capacity of approximately 500,000 barrels of water a day.

    Booster and injection pumps will transfer treated effluent water to designated injection wells.

    Additional facilities at GC-30 will include fuel gas treatment, sludge collection and disposal systems, oil recovery systems, control and safety systems, substations, laboratory and workshop facilities, and associated civil, structural, piping, mechanical, electrical and instrumentation works.

    The project also includes transfer pipelines connecting GC-25, GC-15 and GC-30.

    Meil will carry out modifications to existing tanks at GC-30, as well as process and utility tie-ins, electrical and instrumentation modifications and other infrastructure required to integrate the new facilities with KOC’s existing assets.

    Meil’s responsibilities cover the project lifecycle from design and engineering through procurement, construction, testing, pre-commissioning, commissioning, start-up and performance testing.

    The contract also includes operation, maintenance, repair and insurance responsibilities for the designated facilities during the applicable operations and maintenance period.

    Seven companies submitted bids for the project last November.

    The full list of bids was:

    • Meil (India) – KD117m ($381m)
    • Mechanical Engineering & Contracting Company (Kuwait) – KD130m
    • Spetco (Kuwait) – KD158m
    • Al-Kharafi (Kuwait) – KD164m
    • China Oil HBP Science & Technology (China) – KD169m
    • Alghanim International (Kuwait) – KD169m
    • Jereh Oil & Gas Engineering (China) – KD191m

    In October last year, KOC awarded Meil a separate contract for a project to develop a gas sweetening and recovery facility in west Kuwait.

    Meil submitted the lowest bid for that tender, at KD69.2m ($225.5m), in February 2025.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19911322/main.jpg
    Wil Crisp
  • Kuwait refinery project on track for year-end completion

    23 September 2026

     

    A $65m project to replace a substation at the Mina Al-Ahmadi (MAA) refinery is on schedule to be mechanically complete before the end of the year, according to industry sources.

    The project is being executed by India’s Larsen & Toubro (L&T), which was awarded the contract in October 2024.

    One source said: “This project is approaching completion and is currently on schedule to be completed before the end of the year, although it could still see delays related to the ongoing regional conflict.”

    The client is state-owned downstream operator Kuwait National Petroleum Company (KNPC).

    Kuwait’s Ministry of Electricity, Water & Renewable Energy (MEW) is also involved in the project and will provide final approvals and sign-off.

    The scope of the project includes:

    • Construction of a substation
    • Installation of transformers
    • Installation of medium-voltage switchgear
    • Installation of low-voltage auxiliary systems
    • Installation of network protection systems
    • Installation of disconnecting switches
    • Installation of surge arrestors
    • Installation of feeder breakers and cubicles
    • Installation of low-voltage A/C and D/C equipment
    • Installation of battery banks and battery chargers
    • Installation of related relay and control panel boards
    • Installation of fire alarm and fire protection equipment
    • Installation of a SCADA system
    • Installation of cables
    • Civil works
    • Associated facilities

    The current project to replace a substation at the MAA refinery closely resembles another project tendered by KNPC more than a decade ago, which L&T also won.

    On 18 May 2015, KNPC signed a contract with L&T to build a new 240MW substation at the MAA refinery, valued at KD21.866m.

    The new substation, known as M20, was designed to replace an existing substation that was considered old and obsolete.

    Mohammed Al-Mutairi, who was KNPC’s chief executive at the time, said the substation building would be explosion-proof and use state-of-the-art control systems.

    He said the station’s capacity would increase from 180MW to 240MW, supplying most of the refinery’s electricity needs.

    Given the similarities between the two projects, L&T has been able to reuse some designs, creating efficiencies, according to industry sources.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19911319/main.jpg
    Wil Crisp
  • Contractor wins $208m Almoosa hospital MEP contract

    23 September 2026

    Register for MEED’s 14-day trial access 

    Riyadh-based construction firm BEC Arabia has won a SR781m ($208m) contract for the mechanical, electrical and plumbing (MEP) works at Almoosa Hospital in Al-Khobar.

    Saudi Arabia’s Almoosa Health Company awarded the contract.

    The hospital complex consists of two towers: a 24-storey in-patient tower with 380 beds, and an 11-storey tower with 224 clinics and 113 additional treatment spaces.

    It will be built on a 45,000-square-metre site.

    A podium spanning the ninth and 10th floors will connect the two towers.

    The hospital will also include parking for 1,700 cars.

    BEC Arabia won the SR656m ($175m) main construction contract for the hospital in November last year.

    In August 2025, MEED reported that Almoosa Health Company had announced it had secured a sharia-compliant credit facility worth SR650m ($173m) from Banque Saudi Fransi.

    In a statement published on the Saudi stock exchange (Tadawul), the company said the seven-year facility would be used to support its expansion and growth strategy.

    Lebanon’s Dar, US-based Perkins&Will and French design firm Pierre-Yves Rochon designed the project.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19910889/main.jpg
    Yasir Iqbal
  • UAE to develop integrated waste-to-resource pilot

    23 September 2026

    Emirates Biotech and United Arab Emirates University (UAEU) have launched a pilot project in Al-Ain that could provide a model for larger waste-to-resource facilities.

    The project involves developing the UAE’s first integrated organic-waste valorisation pilot plant, which will test whether food waste and compostable packaging can be processed together to recover resources and reduce waste sent to landfill.

    Located near the UAEU campus, the 40kg-a-day facility will process organic waste to produce renewable biogas and nutrient-rich compost. The project is intended to generate technical and operating data that could support the development of larger-scale facilities.

    Emirates Biotech and UAEU will design, build and operate the pilot plant as part of a two-year research project running from August 2026 to August 2028. Installation and commissioning are expected to be completed by August 2027.

    The plant will combine anaerobic digestion and composting. Anaerobic digestion will convert the organic waste into renewable biogas, while the resulting digestate will be composted to produce nutrient-rich compost.

    A laboratory-scale assessment will also examine the potential to convert the biogas into renewable hydrogen.

    Food waste accounts for nearly 40% of daily municipal solid waste in the UAE, according to Emirates Biotech, and much of it is currently disposed of in landfills.

    The pilot will therefore assess the technical and operational feasibility of recovering value from two waste streams through a single integrated process.

    If successfully scaled, Emirates Biotech says an integrated organic-waste valorisation plant could reduce CO₂ emissions by 89% compared with landfilling.

    The project is expected to provide a scalable and modular model for converting food waste and compostable packaging into renewable biogas and compost, with the findings intended to inform the development of larger waste-to-resource facilities.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19908972/main.jpg
    Mark Dowdall
  • Contractors prepare Oxagon Highway 55 bids

    23 September 2026

     

    Contractors are preparing to submit bids on 28 September for a design-and-build contract for permanent upgrade works on Highway 55 in the kingdom’s Oxagon region.

    The first phase of the project includes constructing 14 kilometres of road, with two lanes in each direction. It also includes one bridge and three interchanges.

    The project duration is 22 months.

    Highway 55 connects the Red Sea coast with the mainland in northwestern Saudi Arabia. It is currently the only road providing north-south connectivity between Duba and the Neom region.

    MEED reported exclusively in August 2025 that contractors had submitted responses to an expression of interest notice that Neom had issued earlier that month.

    The project is expected to support cargo movement from Duba Port to other parts of the kingdom and the wider region.

    Last year, Neom tested a pilot initiative by handling a shipment that travelled from Cairo via the Port of Safaga, across the Red Sea to the Port of Neom, and then inland to Erbil, Iraq.

    In a statement, Neom said: “The shipment travelled through an intermodal corridor spanning over 900 kilometres, marking a significant milestone in the kingdom’s transformation into a regional and global logistics hub.”

    The Port of Neom is located on the Red Sea near the Arar border, a key entry point into Iraq.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19907876/main.jpg
    Yasir Iqbal