ADNOC sanctions giant gas development designed to run with net-zero CO2 emissions

UAE’s energy giant Abu Dhabi National Oil Company (ADNOC) has made a final investment decision and awarded a batch of contracts for a giant gas development, which aims to operate with net-zero carbon dioxide (CO2) emissions, reinforcing the UAE player’s accelerated decarbonization agenda and supporting its net-zero by 2045 ambition and aspirations to double its carbon capture capacity target to 10 mtpa of CO2 by 2030.

ADNOC announced the final investment decision for the Hail and Ghasha offshore development project and signed two deals, which comprise two engineering, procurement, and construction (EPC) contracts, at ADIPEC, where experts from across the energy ecosystem and beyond gathered in Abu Dhabi from October 2 to October 5, 2023, to address critical energy and climate challenges and accelerate innovation and solutions-oriented dialogue under the theme ‘Decarbonizing. Faster. Together.‘

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. The Ghasha Concession is set to produce more than 1.5 billion standard cubic feet per day (bscfd) of gas before the end of the decade.

Abdulmunim Al Kindy, ADNOC Upstream Executive Director, said: “The final investment decision, for Hail and Ghasha, is a major milestone for ADNOC and our strategic partners and we are delighted to progress this pioneering project with net-zero carbon dioxide emissions, significantly boosting ADNOC’s carbon capture capacity as we work toward a lower carbon future. 

“The project will drive in-country value, provide highly skilled career opportunities for UAE Nationals and stimulate socio-economic growth for the nation. Natural gas is an important transition fuel and ADNOC will continue to responsibly unlock its gas resources to enable gas self-sufficiency for the UAE, grow our export capacity and support global energy security.” 

According to ADNOC, over 60% of the investment value of the entire project will flow back into the UAE’s economy under its In-Country Value (ICV) program, reinforcing the firm’s commitment to ensuring more economic value remains in the country from the contracts it awards.

Furthermore, the Hail and Ghasha development design combines decarbonization technologies into one integrated solution, aiming to capture 1.5 million tonnes per year (mtpa) of CO2 taking ADNOC’s committed investment for carbon capture capacity to almost 4 mtpa.

The CO2 will be captured, transported onshore, and safely stored underground, while low-carbon hydrogen is being produced, so that, it can replace fuel gas and further reduce emissions. In addition, the project will leverage clean power from nuclear and renewable sources from the grid. The UAE giant claims that this is the world’s first project that aims to operate with net-zero emissions.

The company highlights that the carbon captured at Hail and Ghasha will support its wider carbon management strategy, which aims to create a unique platform that connects all the sources of emissions and sequestration sites to accelerate the delivery of decarbonization goals.

The first EPC contract for the offshore facilities, awarded to a joint venture between National Petroleum Construction Company and Saipem, includes facilities on artificial islands and subsea pipelines. On the other hand, the second EPC contract, awarded to Tecnimont, will deliver the onshore scope, including CO2 and sulphur recovery and handling.

Moreover, ADNOC awarded two substantial contracts, totaling $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 EPC contracts for the Dalma gas development project, within the Ghasha Concession in November 2021.

The production from the Ghasha Concession is expected to start around 2025. Four artificial islands have already been completed and development drilling is underway.