BP and Royal Dutch Shell have placed their bids for a sour gas project in the UAE that could cost $10 billion and will generate 1 billion cubic feet of gas per day. It is also learnt that France’s Total and the US based Occidental Petroleum Corporation are also in the fray to clinch the contract. The Abu Dhabi National Oil Company had invited bids from several other firms. The contract will be awarded in the last quarter.
The project could be dubbed as is one of the largest open to oil and gas companies competing for limited access to the Middle East’s energy reserves. Saudi Arabia, home of the world’s largest energy resource, keeps this sector closed to international firms, at the same time gas exporter Qatar has a moratorium on new projects.
Senior analyst for the Middle East at global consultancy Wood Mackenzie has said, ‘This is the largest gas development in the region in terms of gross production. It is also one of the biggest projects available for participation of international companies. The successful bidder will look forward to a long-term role in the future of Abu Dhabi’s gas development’.
According to the terms of the contract the winner of the bid will take a 40 percent stake in the project, whereas the state-run Abu Dhabi National Oil Company (ADNOC) would take the controlling stake of 60 percent. The project was projected to have gross gas production of about 3 billion cubic feet per day and experts valued investment in the project could total $10 billion.
The UAE possess the world’s fifth largest proven gas reserves at around 200 trillion cubic feet. However, in recent times it was felt that there is a persistent need to develop them to meet soaring domestic demand. Following a considerable economic expansion due to record oil revenues, the UAE is at present facing rising energy needs to keep the economy moving in positive direction.
