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Adnoc and German firm sign decarbonisation agreement

16 October 2023

Abu Dhabi National Oil Company (Adnoc) and German energy company Wintershall Dea have signed an agreement to collaborate on decarbonisation opportunities globally, and particularly in Germany.

“Our partnership with Wintershall Dea could expand our low-carbon hydrogen production to Europe, where we have already sent demonstration cargoes to our customers,” Adnoc .

“Partnerships such as these are essential for the development of a hydrogen economy and successful energy transition,” Adnoc added, without elaborating on the terms of the agreement.

The deal emanates from the Energy Security and Industry Accelerator agreement signed between the UAE and Germany in September 2022, when they agreed to accelerate projects of joint interest in energy security, decarbonisation and climate action through the framework deal.

As part of the agreement, Adnoc entered into a liquefied natural gas (LNG) supply deal with German utility provider RWE Aktiengesellschaft (RWE), with further cargos reserved for German customers in 2023.

Adnoc delivered an LNG shipment to RWE in February this year under the deal, marking the first time an LNG cargo was shipped to Germany from the Middle East.

Adnoc has also entered into deals with other German customers, including Steag and Aurubis, for demonstration cargos of blue ammonia. The Abu Dhabi energy giant delivered a cargo of blue ammonia to Aurubis in October last year.

Adnoc also signed a memorandum of understanding (MoU), in March, with the government of the German state of North Rhine-Westphalia and German chemical industry services provider Currenta GmbH & Company OHG (Currenta) to explore opportunities in the low-carbon ammonia value chain in the regional industrial sector.

Wintershall Dea in the UAE

Wintershall Dea was formed in 2019 through the merger of Wintershall and Dea, with its headquarters located in Kassel, Germany. German chemicals producer BASF owns the majority 72.7 per cent of shares in Wintershall Dea, with the remaining 27.3 per cent shares held by Luxembourg-based investment firm LetterOne.

Wintershall Dea is a stakeholder in Abu Dhabi’s Ghasha offshore sour gas concession, holding a 10 per cent interest in the asset since November 2018.

Adnoc is the owner and operator of the Ghasha concession, owning the majority 55 per cent stake. The other stakeholders are Italian energy major Eni with 25 per cent, and Austria’s OMV and Russia’s Lukoil, each with 5 per cent.

The Ghasha concession consists of the Hail and Ghasha fields, along with the Hair Dalma, Satah, Bu Haseer, Nasr, Sarb, Shuwaihat and Mubarraz fields.

In early October, Adnoc and its partners achieved the final investment decision on the Ghasha concession and awarded $ 16.94bn worth of engineering, procurement and construction (EPC) contracts for the Hail and Ghasha offshore sour gas field development megaproject.

Wintershall Dea, however, is considering an exit from the Ghasha concession, as recently reported by Upstream, a move that could jeopardise progress on the Hail and Ghasha megaproject.

As part of its stake in the Ghasha concession, Wintershall Dea operates the Shuwaihat offshore field. The company has been carrying out exploratory drilling activity at Shuweihat since 2016 at least, and has been able to make small discoveries of sour gas reserves over the years.

ALSO READ: Hail and Ghasha galvanises UAE upstream market
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Indrajit Sen

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