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
  • Adnoc plans new offshore-to-onshore oil transport pipeline

    20 August 2026

     

    Abu Dhabi National Oil Company is moving ahead with an ambitious plan to build an oil pipeline network that will transport oil from its main offshore oil processing islands in the Gulf to its onshore crude export terminal in Jebel Dhanna, Abu Dhabi.

    The planned pipeline network will source crude from Zirku Island and Das Island, where Adnoc gathers and treats oil produced at Abu Dhabi’s offshore fields, among other processing hubs, and transport those volumes across 300 kilometres inland to the Jebel Dhanna terminal.

    According to sources, the proposed pipelines will eventually connect to the West-East crude pipeline network currently being built from Abu Dhabi’s Jebel Dhanna to the emirate of Fujairah, and is expected to be commissioned in 2027.

    The Abu Dhabi energy giant has awarded a contract for concept studies and front-end engineering and design (feed) to Abu Dhabi-based NT Energies, a joint venture of Abu Dhabi-based contractor NMDC Energy and France’s Technip Energies, sources told MEED.

    NT Energies is expected to carry out the concept studies and feed on a “fast-track basis”, with the work anticipated to take seven months, sources said.

    A kick-off meeting between the client and the appointed consultant took place on 6 July, sources added.

    Additionally, Adnoc has appointed Australia-headquartered Worley to provide project management consultancy (PMC) services, sources further said.

    West-East oil pipeline

    In May, Adnoc said it was accelerating work on the West-East crude transport pipeline project from Jebel Dhanna to Fujairah, upon directions from its board.

    The West-East pipeline project involves constructing a cross-country pipeline to transport crude from Adnoc’s export terminal at Jebel Dhanna to the Fujairah terminal, covering a distance of about 520km.

    The pipeline will double Adnoc’s crude export capacity through Fujairah on the Indian Ocean coast and enable shipments to bypass the geopolitically volatile Strait of Hormuz.

    Crude will be sourced from Adnoc’s offshore processing centres at Das, Zakum and Umm Lulu islands before being stored at new storage facilities to be built at the Jebel Dhanna terminal.

    The pipeline will be segmented into three sections:

    • Jebel Dhanna to Habshan main pumping station (MPS) – 115km
    • Habshan MPS to Sweihan depot – 254km
    • Sweihan depot to Fujairah terminal – 153km

    Adnoc awarded Egyptian contractor Engineering for Petroleum & Process Industries (Enppi) an engineering, procurement and construction management (EPCm) contract for the project in February 2024.

    Adnoc’s total spend on EPCm works could be as high as $3bn, MEED previously reported.

    Sources have told MEED that Adnoc has, in turn, appointed state-owned China Petroleum Pipeline (CPP) and locally based Bin Asheer to carry out construction works on the three segments of the West-East pipeline network.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/18887774/main0639.jpg
    Indrajit Sen
  • Contractors confirm Al-Maktoum airport people-mover award

    20 August 2026

    Register for MEED’s 14-day trial access 

    A team of Japan’s Mitsubishi Corporation and Indian contractor Larsen & Toubro (L&T) has confirmed that it has won a design-and-build contract for the automated people-mover (APM) system for phase one of Al-Maktoum International airport in Dubai.

    In a statement released earlier today, L&T classified the contract as large, a term the company uses to denote an order value of $261m-$523m.

    MEED exclusively reported in July that Dubai Aviation Engineering Projects (DAEP) had selected a contractor to deliver the APM system as part of the first phase of the $35bn expansion of the airport.

    The APM system will serve as a critical facility for operations at Al-Maktoum International. The system will run under the apron of the entire airfield and the airport’s terminals. It will consist of several tracks, taking passengers from the terminals to the concourses.

    Four underground stations will be built as part of the first phase. The overall plan includes 14 stations at the airport.

    The firms submitted the bids for the project in July last year, as MEED exclusively reported.

    The contract is the latest in a series of awards signed by DAEP recently. It has awarded contracts valued at about AED13bn ($3.5bn), with construction works currently under way on several airport packages.

    These include enabling works, the second runway and the initial structural foundations for passenger terminals and gates.

    Upcoming awards

    In June, DAEP said that it will award contracts worth over AED55bn ($15bn) by the end of this year for construction works at Al-Maktoum International airport.

    The projects slated for contract awards include the substructure works for the western passenger terminal, the fourth aircraft concourse building and the baggage handling system, in addition to the superstructure works for the western passenger terminal and the first, second and third aircraft concourses.

    The packages also encompass long-span structural frameworks for buildings covering about 1.5 million square metres (sq m), infrastructure works for the southern airfield area and power generation and district cooling plants supporting the construction programme.

    The award of the facade and roofing packages is also planned for this year.

    Construction progress

    In May last year, MEED exclusively reported that DAEP had awarded a AED1bn ($272m) deal to UAE firm Binladin Contracting Group to construct the second runway at the airport.

    The enabling works on the terminal were awarded to Abu Dhabi-based Tristar E&C.

    Construction on the project’s first phase is expected to be completed by 2032.

    Construction of substructure works began in November last year, when DAEP formally selected a contractor to deliver the package.

    The government approved the updated designs and timelines for its largest construction project in April 2024.

    In a statement, the authorities said the plan is for all operations from Dubai International airport to be transferred to Al-Maktoum International within 10 years.

    According to an official description on DAEP’s website, the expanded airport’s West Terminal will be a seven-level, 800,000 sq m facility with an annual capacity of 45 million passengers.

    It will be the second of three terminals at the airport.

    In September 2024, MEED exclusively reported that a team comprising Austria’s Coop Himmelb(l)au and Lebanon’s Dar Al-Handasah had been confirmed as the lead masterplanning and design consultant on the expansion of Al-Maktoum.

    The airport’s construction is planned to be undertaken in three phases. It will cover an area of 70 square kilometres south of Dubai and will have five parallel runways and 430 aircraft gates.

    It will be five times the size of the existing Dubai International airport and will have the world’s largest passenger-handling capacity of 260 million passengers a year. For cargo, it will have the capacity to handle 12 million tonnes a year.

    READ THE AUGUST 2026 MEED BUSINESS REVIEW – click here to view PDF

    Saudi Arabia builds for the global stage; Rising uncertainty creates fresh set of challenges in the Maghreb; Gulf banks remain robust in the face of geopolitical tensions.

    Distributed to senior decision-makers in the region and around the world, the August 2026 edition of MEED Business Review includes:

    > MARKET FOCUS: Maghreb fortunes diverge
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/18884056/main.png
    Yasir Iqbal
  • Saudi Arabia awards estimated $1bn phosphate rail deal

    20 August 2026

     

    Register for MEED’s 14-day trial access 

    Saudi Arabian Railways (SAR) has awarded an estimated SR4bn-plus ($1.1bn) contract to add another track to the first section of the existing phosphate transport railway network in the kingdom’s Eastern Province.

    The contract was awarded to local firm Alomaier Trading & Contracting Company.

    The scope includes track doubling, alignment modifications, utility bridges, culvert widening and hydrological structures, as well as the conversion of the AZ1 siding into a mainline track.

    The scope also covers support for signalling and telecommunications systems.

    The existing railway line runs from the Waad Al-Shamal mines to Ras Al-Khair. The new project will cover about 100 kilometres (km), connecting the AZ1/Nariyah Yard to Ras Al-Khair.

    Switzerland-based engineering firm ARX is the project consultant.

    The project is the first of four packages for the phosphate railway line that SAR is expected to award imminently.

    In 2023, MEED reported that SAR was planning two projects to increase its freight capacity, including an estimated SR4.2bn ($1.1bn) project to install a second track on the North Train freight line and construct three new freight yards.

    Formerly known as the North-South Railway, the North Train is a 1,550km-long freight line running from the phosphate and bauxite mines in the far north of the kingdom to the Al-Baithah junction. There, it diverges into a line southward to Riyadh and a second line running east to downstream fertiliser production and alumina refining facilities at Ras Al-Khair on the Gulf coast.

    Adding a second track and the freight yards will significantly increase cargo-carrying capacity on the network and facilitate growth in industrial production. Project implementation is expected to take four years.

    State-owned SAR is also considering increasing the localisation of railway-focused materials and equipment, including the construction of a cement sleeper manufacturing facility.

    READ THE AUGUST 2026 MEED BUSINESS REVIEW – click here to view PDF

    Saudi Arabia builds for the global stage; Rising uncertainty creates fresh set of challenges in the Maghreb; Gulf banks remain robust in the face of geopolitical tensions.

    Distributed to senior decision-makers in the region and around the world, the August 2026 edition of MEED Business Review includes:

    > MARKET FOCUS: Maghreb fortunes diverge
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/18876428/main.jpg
    Yasir Iqbal
  • Libya and Tunisia reschedule joint oil and gas licensing round

    19 August 2026

    The Libyan-Tunisian Joint Oil Exploration, Exploitation & Petroleum Services Company (Joint Oil) has rescheduled its planned licensing round for offshore exploration and development projects in a zone spanning the waters of both countries.

    The bidding process is now due to open on 7 September 2026, with bid submissions due by 8 January 2027.

    Previously, in May, Joint Oil said it planned to open the bid round on 1 August 2026.

    The upcoming round will offer two oil and gas packages. The first is an exploration package across the 3,000-square-kilometre Joint Oil Block, in water depths of 80-120 metres.

    Significant data is available on the geology of this area, including 6,500km of 2D and 1,900 square kilometres of 3D seismic data. Data also exists from a run of legacy wells dating to 1976.

    The second package covers development of the Zarat discovery specifically. This is a gas-condensate reservoir straddling the boundary between Tunisia’s national acreage and the jointly-held Joint Oil Block.

    Joint Oil is equally owned by Tunisia’s national oil company, ETAP, and OLA Energy Holdings, a subsidiary of the Libya Africa Investment Portfolio (LAIP).

    LAIP is a subsidiary of Libya’s sovereign wealth institution, the Libya Investment Authority.

    Joint Oil was established under a bilateral agreement between Libya and Tunisia in 1988 to explore and develop hydrocarbons in offshore areas shared by the two countries.

    The key dates from the new schedule for the licensing round are:

    • 7 September 2026: Bid round opens; qualified offshore operators can apply for access to the Virtual Data Room
    • 9 September 2026: Joint Oil presents the opportunity at the MMEA Scout Group meeting in London
    • 29-30 September 2026: Joint Oil presents at the World Energy Summit in London
    • 31 December 2026: Bid round closes
    • 8 January 2027: Bid submissions due
    • 26 February 2027: Winning bidders notified
    • 30 April 2027: Formal awards expected

    Texas-based Moyes & Co is acting as a strategic adviser on the licensing round.

    Houston-headquartered Marathon discovered the Zarat field in 1992. It is estimated to hold around 0.4 trillion cubic feet of recoverable gas and 50 million barrels of liquids.

    A previous development project concept centred on a mobile production unit, worth around $1bn, tied back to the nearby Miskar platform.

    Despite this, the field has remained undeveloped for over three decades.

    One of the key challenges to developing the reserve is its high carbon dioxide content.

    Joint Oil has run bid rounds for the acreage before without success, including as recently as late 2023.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/18861047/main0914.jpg
    Wil Crisp
  • UAE cuts trade and financial links with Iran

    19 August 2026

    Register for MEED’s 14-day trial access 

    The UAE has halted all trade, commercial exchanges and financial transactions with Iran until further notice, the Ministry of Foreign Affairs said on 19 August.

    The suspension has been imposed in light of escalations that undermine regional and international peace and security, the ministry said. It did not specify a timeframe for any resumption.

    The ministry rejected allegations regarding the status of the economic relationship between the UAE and Iran, and restated the UAE's commitment to dialogue, cooperation and regional integration as means of advancing peace, stability and prosperity in the region.

    It said the UAE remains committed to safeguarding the integrity of the financial system, in line with international law and global standards.

    The suspension covers the full range of commercial and financial links between the two countries. The UAE has historically been one of Iran's most significant trading partners, with much of the relationship built on re-export trade routed through Dubai to Iranian ports across the Gulf.

    The ministry statement did not detail the mechanism for enforcing the halt, the sectors affected, or arrangements for existing contracts and in-transit cargo.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/18857953/main0856.jpg
    Colin Foreman