ADNOC to develop huge onshore gas find near Dubai

Dubai — Abu Dhabi National Oil Co. will develop a new shallow gas discovery with estimated reserves of 80 trillion cubic feet as the country pushes towards a goal of gas self-sufficiency.

ADNOC is the UAE's biggest energy company, pumping some 3 million b/d, and Dubai's gas supplier.

The gas discovery was made within a 5,000 sq km area between the Saih Al Sidirah coastal development and Jebel Ali in the emirates of Abu Dhabi and Dubai respectively after drilling more than 10 exploration and appraisal wells, ADNOC said.

The find is the UAE's second gas discovery in a week. Last Monday, Eni and the UAE's Sharjah National Oil Corp. said they discovered gas and condensates in the emirate of Sharjah. SNOC said it was the first onshore Sharjah discovery in 37 years, with the well achieving flow rates of up to 50 Mscf/d of lean gas and associated condensate.

"ADNOC will deploy capital, technology, and expertise to develop and produce shallow gas resources and conduct further exploration to assess further volumes and firm up development costs," it said Monday in a statement.

"As part of ADNOC's 2030 strategy, the company also plans to tap gas from its gas caps and substantial unconventional gas reserves, as well as new natural gas accumulations, which will continue to be appraised and developed as the company pursues its exploration activities."

This is the first time ADNOC has explored for hydrocarbon resources in Dubai. The new reservoir, discovered on the Abu Dhabi-Dubai border, will be supplied to Dubai Supply Authority (DUSUP), which caters to the energy needs of a number of utility and industrial companies in the UAE's second-largest city.

DUSUP currently imports gas from Qatar through Dolphin Energy, the joint venture between Abu Dhabi's Mubadala Investment Co, Occidental Petroleum and Total.

Gas self-sufficiency

The major gas find ranks as the biggest global gas discovery since Turkmenistan's Galkynysh field was discovered in 2005 and could be "hugely significant" for the UAE, energy research group Wood Mackenzie said in a note.

"The shallow nature of the find will mean that development costs will be much lower than some of Abu Dhabi's sour gas resources," Wood Mac said. "A discovery of this scale will be a clear priority for development...longer term, the field is likely to play a pivotal role in the UAE's gas market and could lead to additional gas exports from the country."

Last year, Abu Dhabi's Supreme Petroleum Council announced increases in recoverable reserves of 7 billion barrels of oil and 58 Tcf of conventional gas, bringing the total to 105 billion barrels of recoverable oil, 273 Tcf of conventional gas and 160 Tcf of unconventional gas resources.

ADNOC officials have spoken of reaching gas "self-sufficiency" and even becoming a net exporter of the fuel in the long-term as the UAE emirate beefs up exploration and development of gas fields.

ADNOC, which produces 10.5 Bcf/d of gas all in the UAE, is boosting its gas output with the help of international oil companies.

Germany's Wintershall and Italy's Eni are working with ADNOC to develop the Ghasha ultra-sour gas concession which is expected to produce over 1.5 Bcf/d by around 2025. In addition, ADNOC plans to boost production from its Shah sour gas field from about 1.3 Bscf/d to 1.5 Bcf/d through its joint venture with Occidental.

It also plans to move forward to develop the sour gas fields at Bab and Bu Hasa.