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
  • Jordan sets market briefing for Amman water PPP

    10 April 2026

    Jordan’s Ministry of Investment, through its Public-Private Partnership Unit (PPPU), has announced a public information session for the South Amman non-revenue water (NRW) reduction PPP project.

    The session will be held on 15 April and is being organised in collaboration with the Ministry of Water & Irrigation and Miyahuna, according to a notice published by the PPPU. 

    The project covers the southern and southeastern areas of Amman and aims to reduce water losses and improve the efficiency of the capital’s distribution network.

    According to the ministry, the scheme will serve about 1.4 million people across 17 zones and forms part of Jordan’s wider National Water Strategy. 

    The planned market briefing is intended to provide early detail on the project’s PPP structure, procurement pathway and performance-based contracting model.

    It is also expected to outline the project’s risk allocation and bankability framework to prospective investors, operators and infrastructure companies.

    The Ministry of Investment opened prequalification for the scheme in March.

    Qualified companies and consortiums have been invited to participate in a two-stage procurement process for the performance-based contract. 

    The project aims to reduce NRW levels to 25% by 2040, while modernising and expanding the existing network using smart technologies and advanced leak detection systems. 

    The original deadline was 23 April. That has since been extended to 12 May.

    Jordan is among the most water-scarce countries in the world, and losses from distribution networks are estimated to account for about 45% of water supplied.

    The country is also advancing its $6bn Aqaba-Amman water desalination and conveyance project that aims to meet about 40% of Jordan’s municipal water demand by 2040.

    As MEED recently reported, the project is nearing financial close. Once complete, it will supply about 300 million cubic metres of potable water a year from the Red Sea to Amman and other regions.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16340931/main.jpg
    Mark Dowdall
  • OQ allows more time for natural gas liquids project proposals

    10 April 2026

     

    Omani state energy conglomerate OQ Group has allowed contractors more time to prepare proposals for a major project to build a natural gas liquids (NGL) facility in the sultanate.

    The planned NGL facility will extract condensates in Saih Nihayda in central Oman and transport those volumes to Duqm, located along the sultanate’s Arabian Sea coastline, for fractionation and export, OQ Group has said.

    OQ Group intends to deliver the project using a front-end engineering and design (feed)-to-engineering, procurement and construction (EPC) competition model.

    The state enterprise issued the main tender for the feed-to-EPC competition “earlier in March”, setting an initial deadline of 8 April for contractors to submit proposals, MEED previously reported. The deadline has now been extended to 6 May, according to sources.

    MEED previously reported that OQ had started the prequalification process for the feed-to-EPC contest for the planned NGL project in November last year, with contractors submitting responses by 15 December.

    The following contractors, among others, are understood to have been invited to participate in the feed-to-EPC contest for OQ’s planned NGL project, sources told MEED:

    • Chiyoda (Japan) / CTCI (Taiwan)
    • G S Engineering & Construction (South Korea)
    • Hyundai Engineering & Construction (South Korea) / KBR (US)
    • JGC Corporation (Japan)
    • Kent (UAE)
    • Petrofac (UK)
    • Saipem (Italy)
    • Samsung E&A (South Korea) / Larsen & Toubro Energy Hydrocarbon (India) / Wood (UAE)
    • Technip Energies (France)
    • Tecnicas Reunidas (Spain)
    • Tecnimont (Italy)

    The scope of work on the project covers the development, verification and integration of feed deliverables for the following facilities and systems:

    • NGL extraction facility – Saih Nihayda:
      • Verification and updating of the existing feed to enable dual-mode operation (ethane recovery and ethane rejection).
      • Identification and implementation of required process, equipment, utilities, and control system modifications.
         
    • NGL Pipeline – Saih Nihayda to Duqm:
      Feed for a new approximately 230km NGL transmission pipeline, including routing, hydraulics, stations, pigging facilities, metering, corrosion protection, leak detection, and safety systems.
       
    • Fractionation unit at Duqm:
      • Feed for a new fractionation facility to process ethane and propane + NGL and recover propane, butane, condensate, and provision for future ethane recovery.
      • Design accommodating licensed or open-art technology and future tie-in to a planned petrochemical project in Duqm.
         
    • Product pipelines, storage and export facilities at Duqm jetty:
      • Feed for product pipelines, cryogenic and atmospheric storage tanks, vapour recovery systems, marine loading arms, and export facilities.
      • Integration with existing port and refinery infrastructure, where feasible.
         
    • Supporting systems and studies:
      Utilities, offsites, flare systems, safety and environmental studies, cost estimates (class 2+10%), project schedules, constructability assessments, and EPC tender documentation.
    Natural gas liquids projects

    Gulf national oil companies have been allocating significant capital expenditure to building or expanding NGL production facilities.

    QatarEnergy, in September last year, awarded the main EPC contract for its project to add a fifth NGL train at its fractionation complex in Qatar’s Mesaieed Industrial City. The aim of the project, which is estimated to be worth $2.5bn, is to build a fifth NGL train (NGL-5) with the capacity to process up to 350 million cubic feet a day of rich associated gas from QatarEnergy’s offshore and onshore oil fields.

    The main EPC contract for the QatarEnergy NGL-5 project was won by a consortium of India’s Larsen & Toubro Energy Hydrocarbons Onshore and Greece-headquartered Consolidated Contractors Group.

    Separately, the gas processing business of Abu Dhabi National Oil Company (Adnoc Gas) has also selected the main contractor for a project to install a fifth NGL fractionation train at its Ruwais gas processing facility in Abu Dhabi.

    The fifth NGL fractionation train will have an output capacity of 22,000 tonnes a day, or about 8 million tonnes a year.

    The Ruwais NGL Train 5 project represents the second phase of Adnoc Gas’ ambitious Rich Gas Development (RGD) programme, and its budget value is estimated to be around $4bn, Peter Van Driel, Adnoc Gas’ chief financial officer, confirmed in February. The company expects to achieve final investment decision on the project within the first quarter of 2026, Van Driel said at the time.

    ALSO READ: PDO awards Oman gas plant expansion project
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16340039/main5958.jpg
    Indrajit Sen
  • Masdar’s move abroad will not be the last

    10 April 2026

    Commentary
    Mark Dowdall
    Power & water editor

    Masdar’s new joint-venture agreement with France’s TotalEnergies will not be the last time we see regional energy investors use strong balance sheets and domestic growth to build larger positions overseas.

    For Masdar in particular, the deal broadens its international exposure at a time when investors are asking questions about the Middle East’s geopolitical risk.

    By combining portfolios, the two companies start with 3GW of operational capacity and another 6GW in advanced development.

    The deal covers nine Asian countries, reflecting a prudent strategy that spreads capital across markets with different risk profiles and growth trajectories.

    In Kazakhstan, which already includes 2.6GW of assets under development, there is clear logic behind this move.

    The country is expected to see a significant increase in renewable generation over the next decade, supported by strong wind resources and the availability of large land areas for utility-scale developments.

    There is also a practical advantage in partnering with TotalEnergies, which already has project delivery experience and an established presence in several of these markets.

    The US-Iran ceasefire announced on 8 April has brought some respite to energy infrastructure stakeholders in the region.

    For investors and developers, however, the long-term uncertainty remains. Until there is clear evidence of regime change, the removal of sanctions or lasting peace in the region, the outlook will be less clear.

    With uncertainty one of the biggest killers of investor confidence, many will now be looking at this agreement and thinking whether they should also follow suit.

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

    Economic shock threatens long-term outlook; Riyadh adjusts to fiscal and geopolitical risk; GCC contractor ranking reflects gigaprojects slowdown.

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

    > GCC CONTRACTOR RANKING: Construction guard undergoes a shift
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16340038/main.jpg
    Mark Dowdall
  • Turkish firm launches Mecca villas project

    10 April 2026

    Register for MEED’s 14-day trial access 

    Turkish real estate investment firm Emlak Konut has announced the launch of Hayat Makkah, its first development in Saudi Arabia.

    The project is part of the National Housing Company’s (NHC) wider Mecca Gate masterplan.

    According to the company, Hayat Makkah will feature 1,014 villas, with home sizes ranging from 150 to 5,000 square metres.

    NHC and Emlak Konut signed an investment agreement worth over SR1bn ($266m) in November last year to develop the project.

    The agreement was signed on the sidelines of the Cityscape Global 2025 event in Riyadh.

    Ertan Keles, chairman of Emlak Konut, said the firm is in talks with stakeholders about launching a second project, while a third development is also being lined up in Jeddah.

    GlobalData expects the Saudi Arabian construction industry to grow by 3.6% in real terms in 2026, supported by an increase in foreign direct investment (FDI) and investments in the housing and manufacturing sectors.

    The residential construction sector is expected to grow by 3.8% in real terms in 2026 and register an average annual growth rate of 4.7% between 2027 and 2030, supported by the country’s aim – under Saudi Vision 2030 – to increase homeownership from 65.4% in 2024 to 70% by 2030, including by building 600,000 homes by 2030.

    According to the General Authority for Statistics, Saudi Arabia attracted a net FDI inflow of SR72.3bn ($19.3bn) in the first nine months of 2025, an increase of 32.7% year-on-year (YoY) compared to the same period in 2024.

    Similarly, the total value of real estate loans from banks grew by 11.5% YoY in 2025, preceded by an annual growth of 13.3% in 2024, according to the Saudi Central Bank (Sama).

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

    Economic shock threatens long-term outlook; Riyadh adjusts to fiscal and geopolitical risk; GCC contractor ranking reflects gigaprojects slowdown.

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

    > GCC CONTRACTOR RANKING: Construction guard undergoes a shift
    To see previous issues of MEED Business Review, please click here

     

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16340004/main.png
    Yasir Iqbal
  • Kuwait gives bidders more time for Al-Khairan IWPP

    10 April 2026

     

    Kuwait has extended bidding for the first phase of the Al-Khairan independent water and power producer (IWPP) project.

    The project is being procured by the Kuwait Authority for Partnership Projects (Kapp) and the Ministry of Electricity, Water & Renewable Energy (MEWRE).

    The facility will have a capacity of 1,800MW and 150,000 cubic metres a day of desalinated water. It will be located in Al-Khairan, adjacent to the Al-Zour South thermal plant.

    The new deadline is 30 April. The original deadline was 31 March.

    The main contract was tendered last September. Three consortiums and two individual companies were previously prequalified to participate.

    These include:

    • Abu Dhabi National Energy Company (Taqa) / A H Al-Sagar & Brothers (Saudi Arabia) / Jera (Japan)
    • Acwa (Saudi Arabia) / Gulf Investment Corporation (Kuwait)
    • China Power / Malakoff International (Malaysia) / Abdul Aziz Al-Ajlan Sons (Saudi Arabia)
    • Nebras Power (Qatar)                                                                                                                                        
    • Sumitomo Corporation (Japan)

    The Al-Khairan IWPP project is part of Kuwait’s long-term plan to expand power and water production capacity through public-private partnerships (PPPs).

    The winning bidder will sign a set of PPP agreements covering financing, design, construction, operation and transfer of the project.

    The energy conversion and water purchase agreement is expected to cover a 25-year supply period.

    Kapp extended another deadline recently for a contract to develop zone two of the third phase of the Al-Dibdibah power and Al-Shagaya renewable energy project.

    The PPP authority is procuring the 500MW solar photovoltaic independent power project (IPP) in partnership with the ministry.

    The bid submission deadline was moved to the end of April, a source close to the project told MEED.

    According to the MEWRE, the total generation capacity currently offered under partnership projects has reached 6,100MW, equivalent to about 30% of Kuwait’s existing power capacity.

    The ministry and Kapp are also preparing to tender the main contract for the 3,600MW Nuwaiseeb power and water desalination plant after plans were approved by Kuwait’s Council of Ministers last November.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16339960/main.jpg
    Mark Dowdall