ABU DHABI - The Gas Sector & OGD/AGD Projects.

ADNOC will increase its production of natural gas to 4.5 MCM/day by end-2007, once Phase 3 of its onshore gas development project, the Habshan Gas Complex, delivers further capacity of 1.2 MCM/d, according to an ADNOC report released on Aug 5, 2004. The gas will be used for reinjection into oilfields and as a feedstock for power plants and petrochemicals. The third phase of the onshore gas development (OGD-3) and second phase of the Asab gas development (AGD-2) are an integrated $3+ bn project divided into five packages, the biggest being Package-2 awarded in late November 2004 to Bechtel in a $1,460m contract. (See background of this and earlier phases in Vol. 60, No. 2).

A major part of onshore gas production is being re-injected into the oilfields. The rest is supplied to Gasco which has a major gas liquids complex at Ruwais. Most of the offshore gas goes to the LNG export complex on Das Island. Gasco is in charge of the gas sector and its projects.

Asab gas plant operations were transferred to Gasco in March 2004 from ADNOC, leading to further enhancement of Gasco's position as one of the largest gas-processing companies in the Middle East and one of the biggest industrial projects in the UAE. Gasco now operates five onshore plants in Abu Dhabi. They are the Habshan-Bab gas complex, including the Habshan gas plant and Bab gas plant, the Bu Hasa NGL plant, the Asab NGL plant, the Ruwais NGL plant and Asab gas Plant.

Asab's plant is a gas-cycling facility that has two trains with a combined capacity of 826 MCF/d. After condensate separation, the gas is compressed and re-injected into the reservoir. Stabilised condensate is shipped to the refineries of Takreer.

OGD-3/AGD-2 will raise gas production to 6,900 MCF/d and Abu Dhabi's PG output to 12m t/y by 2008. It will triple ethane output.

In the decade to 2004, demand for onshore gas doubled to almost 4,000 MCF/d. The biggest call has come from oilfield reinjection, which in the second half of 2004 required 1,950 MCF/d. A further 1,800 MCF/d is earmarked as feedstock for the power and water sector and industry, with the majority going to Abu Dhabi Water & Electricity Authority (ADWEA) and Dubai Supply Authority (Dusup).

From the 5,100 MCF/d of feed gas, Gasco will also produce 2,500 t/d of ethane to be used by Abu Dhabi Polymers Company (Borouge), 16,500 t/d of LPG for export and 230,000 b/d of condensate, which is processed in the Ruwais condensate splitter operated by Abu Dhabi Refining Co. (Takreer). The make-up of Gasco's business is set to change, however.

In late 2006, Dolphin Energy will receive at Taweelah the first deliveries of North field gas from Qatar and start supplying all ADWEA installations and industrial consumers in the eastern region and Al-Ain, while Gasco will retain responsibility for existing customers in the western region. The impending arrival of Qatari dry gas is reflected in Gasco's upcoming investment programme, which concentrates on gas recycling and processing projects, rather than producing additional sales gas volumes to utilities and industrial consumers.

Expansion of its existing sites is a priority for Gasco. The company is responsible for three out of the five OGD-3/AGD-2 packages, and each involves sizable investment at its three biggest plants. At the Habshan gas complex, already one of the biggest such installations in the Middle East with a capacity of 3,500 MCF/d, two more trains are to be installed with a combined capacity of 1,300 MCF/d. At the existing Asab gas plant, new natural gas liquids (NGL) extraction facilities are to be built. At the Ruwais fractionation plant on the coast, one of the world's largest NGL trains is to be built with capacity of 24,000 t/d.

Basic engineering on the $700m expansion of the Habshan gas complex is complete. The project involves construction of a new versatile gas train, capable of processing both associated and non-associated gas, as well as new compression and sulphur processing capacity. In addition, with some of its facilities now having been in service for 25 years, more and more emphasis is being placed on upgrades, especially for the control systems. There is an increasing demand for integrity management. The reservoirs are changing. Gasco has to do some debottlenecking and replace some obsolete equipment.

Final prices were submitted on Jan. 5 for Package-5 of the OGD-3/AGD-2 programme. The client for this, Takreer, is expected to award the EPC contracts, covering new storage tanks at Ruwais, by end-January. Five international and local companies submitted third and final prices, with NPCC and Punj Lloyd of India said to be quoting almost identical bids of $56.8m. Larsen & Toubro (L&T), also of India, reportedly submitted a price of about $58m and was followed by Daelim Industrial Company and Samsung Corp., both of South Korea. The EPC contracts call for construction of three 68,000-cubic-metre tanks and associated works. The PMC is Parsons International. The OGD-3/AGD-2 programme has been divided into five separate bid packages. There are three other EPC packages still to be awarded on the project. They are:

Package 1, for which commercial bids are due to be submitted on Jan. 25. The bidders are: NPCC, with Athens-based Consolidated Contractors Int'l Co. (CCC) and ILF Consulting Engineers of Austria; Sharjah-based Petrofac Int'l, with Tekfen of Turkey; Snamprogetti, with Dubai-based Dodsal; and Technip, with the local Al-Jaber Energy Services. Estimated to be worth $200m, the contract covers construction of a gas gathering network for the Thamama F reservoir and reinjection facilities in the Asab field. The PMC is VECO; the client is ADCO.

Package 3, for which the first round of clarifications is due to start soon. Technical bids were submitted on Nov. 1. The bidders are Bechtel, Snamprogetti, Technip and JGC Corp. and Chiyoda Corporation, both of Japan. Worth $500-700m, the contract covers construction of gas treatment and natural gas liquids (NGL) recovery facilities to process 750 MCF/d and an NGL pipeline to Habshan. Technical bids for the PMC have been submitted by VECO, Parsons and Foster Wheeler and Mustang Engineering. The client is Gasco.

Package 4, for which five firms are preparing to submit commercial bids on Jan. 25. They are Bechtel, JGC, Chiyoda, Snamprogetti and Technip. Estimated to be worth $500-700m, the contract covers construction of a new NGL train with capacity of 24,000 b/d, new storage tanks for propane and butane (LPG) and two leading berths. For the PMC, commercial bids are due to be submitted in mid-January. The bidders are VECO, Parsons, Mustang and Foster Wheeler. The client is Gasco.

Onshore gas is the source of supplies to Dubai, which began in late 2000 through a 65-km pipeline from Abu Dhabi's domestic network to the Jebel Ali free zone. Under an agreement signed in 1998, Abu Dhabi gas supplies to Dubai average 500 MCF/d. Dusup's need to increase supplies to 800 MCF/d in 2004 was not met; but relations between new UAE President and Abu Dhabi ruler Shaikh Khalifa Bin Zayed and Dubai's strongman Shaikh Mohammed Bin Rashid have become quite close and, as a result, Abu Dhabi supplies to Jebel Ali may increase. Both Abu Dhabi and Dubai are to import gas from Qatar through the Dolphin programme which is also to supply Oman and Pakistan in future (see Gas Market Trends No. 3 of next week).