First sales and purchase agreement inked for UAE’s low-carbon LNG project

Abu Dhabi National Oil Company (ADNOC) has signed a sales and purchase agreement (SPA) with Germany’s Securing Energy for Europe (SEFE) for the long-term supply of low-carbon liquefied natural gas (LNG) from the Ruwais LNG plant in the UAE, set to be the first LNG export facility in the Middle East and North Africa (MENA) region to run on clean power.

Under the SPA which follows the heads of agreement (HoA) signed in March, ADNOC will deliver one million tonnes of LNG annually to SEFE for a period of 15 years, expected to start in 2028.

The deal is said to represent the first definitive agreement for the supply of LNG from the project.

Egbert Laege, CEO of SEFE, said: “This partnership with ADNOC supports our efforts to responsibly diversify our energy sources, enhance security of energy supply for Germany and Europe and to support our customers on their decarbonisation journey. Furthermore, it is an important step for SEFE’s ambition to drive the energy transition and become a European energy major in the low-carbon economy.”

The Ruwais LNG project is being developed in Al Ruwais Industrial City, Abu Dhabi, and will consist of two LNG liquefaction trains with a combined capacity of 9.6 mmtpa, set to more than double ADNOC’s LNG production capacity.

According to ADNOC, the project will be one of the lowest-carbon-intensity LNG plants in the world, with plans to use artificial intelligence and the latest technologies to enhance safety, minimize emissions, and drive efficiency.

“Natural gas accounts for over a quarter of Germany’s energy supply and we are very pleased to support the country’s energy security through this landmark agreement with SEFE for the lower-carbon Ruwais LNG project,” said Fatema Al Nuaimi, Executive Vice President Downstream Business Management at ADNOC.

“As natural gas demand continues to increase, ADNOC is ensuring greater access to lower-carbon gas to power homes, fuel industries and keep people connected, and we will continue to reinforce our role as a reliable global supplier of natural gas.”

In July, ADNOC penned deals with energy majors BP, Mitsui & Co., Shell, and TotalEnergies, enabling each to get a 10% equity stake in Ruwais LNG, with ADNOC keeping 60%, subject to customary regulatory clearances.

The UAE player previously signed deals for LNG from the future facility with China’s ENN Natural Gas, Singapore’s SAFE, and Germany’s EnBW Energie Baden-Württemberg (EnBW). This summer, ADNOC signed a long-term HoA with Japan’s Osaka Gas for the delivery of up to 0.8 mmtpa of LNG mainly originating from the Ruwais LNG project.