Consortium lands deal for project at world’s largest offshore sour gas development

Consortium lands deal for project at world’s largest offshore sour gas development

UAE’s giant Abu Dhabi National Oil Company (ADNOC) has handed out a letter of award (LOA) to a consortium led by National Petroleum Construction Company (NPCC), a subsidiary of National Marine Dredging Company, for the pre-construction service agreement (PCSA) related to offshore facilities for a giant gas development.

Illustration; Source: ADNOC

According to NPCC, the other consortium members are Saipem and China Petroleum Engineering and Construction Corporation (CPECC) and the company intends to execute this project together with these joint venture partners.

Yasser Zaghloul, Group CEO of NMDC, remarked: “We are honoured that ADNOC awarded this project to the consortium led by NPCC. This award demonstrates our client’s confidence in our ability, and our readiness to support ADNOC as they increase natural gas production in the UAE.”

The letter of award, which covers the early project activities such as initial detailed engineering and procurement of critical long lead items, has been received for the pre-construction service agreement related to the offshore facilities of the Hail and Ghasha gas development project.

In addition, the PCSA scope of work includes the preparation of an open book estimate for the full project delivery scope, which will be considered as part of ADNOC’s final investment decision-making process. NPCC also elaborates that the total value of the project related to the letter of award is about AED 220 million (about $60 million). 

The Hail and Ghasha development project is part of the Ghasha Concession, which is the world’s largest offshore sour gas development and a key component of ADNOC’s integrated gas masterplan as well as an important enabler of gas self-sufficiency for the United Arab Emirates (UAE).

Ahmed Al Dhaheri, CEO of NPCC, commented: “We are committed to employing all our efforts to have a significant positive impact on the energy eco-system and the UAE economy and support ADNOC’s development projects, particularly achieving the highest In-Country Value (ICV). This, in turn, will help to develop local resources, as well as human capacity and talent. We look forward to working with our JV partners to ensure the success of this ambitious project.”

This deal comes after ADNOC awarded two substantial contracts totalling $2 billion (AED 7.49 billion) to ADNOC Drilling for the Hail and Ghasha development project in July 2022. Prior to this, ADNOC and its partners awarded two Engineering, Procurement & Construction (EPC) contracts for the Dalma gas development project, within the Ghasha Concession in November 2021.

They also awarded a contract to update the Front-End Engineering and Design (FEED) for the Hail and Ghasha project. The updated design was expected to be completed by the end of the year to further optimise costs and timing, as well as potentially accelerate the integration of carbon capture.

Production from the Ghasha Concession is expected to start around 2025, ramping up to produce more than 1.5 billion standard cubic feet per day (scfd) of natural gas before the end of the decade. Four artificial islands have already been completed and development drilling is underway.