Dolphin Raises US$4.1bn To Help Finance Pipeline Construction
BMI Industry Insights - Oil & Gas, Middle East & Africa, 03.08.2009
The United Arab Emirates' (UAE) Dolphin Energy has announced that it has raised US$4.1bn to refinance debt, help fund the construction of its Taweelah-Fujairah pipeline and pay for refinancing-related fees. After raising US$3bn from 25 financial institutions in April, it has raised a further US$1.25bn from a debut project bond issue in July. Dolphin's majority shareholder, the Abu Dhabi government's investment firm Mubadala Development Company (51%), played a key role in raising the financing. French major Total and US independent Occidental Petroleum are the other shareholders in Dolphin, with a 24.5% stake each.
According to Dolphin's press release, it will use the raised funds to repay a US$3.45bn loan that it had secured in 2005 and pay 70% of the construction costs of its Taweelah-Fujairah pipeline project. In July 2008, Dolphin awarded a US$418mn construction contract for the pipeline to Russia's Stroytransgaz. Construction work at the pipeline was scheduled to start in Q308, but it is unclear whether construction work has in fact started. According to the company's website, start-up of the project is still scheduled for next year.
In 2007 Dolphin undertook the design and planning of the new 48-inch, 240km-long pipeline, which will link the company's receiving facilities at Taweelah in Abu Dhabi with Fujairah on the UAE's eastern coast. The steel for the pipeline will be supplied by Germany's Salzgitter Mannesmann International. Dolphin and Salzgitter signed a US$200mn contract in December 2007 for the supply of 120,000 tonnes of coated line pipes, the first shipment of which has already arrived in Abu Dhabi, according to Salzgitter. The pipeline will supply gas to the planned Fujairah 2 Power and Desalination Plant, which will be built next to the existing Fujairah 1 plant at Qidfa. Fujairah 1 already receives gas from Dolphin via the company's Al Ain-Fujairah pipeline.
Dolphin supplies the UAE with gas from Qatar via a subsea export pipeline connecting the company's Ras Laffan gas processing plant in Qatar with the receiving facilities at Taweelah. This 48-inch pipeline is 364km long with a maximum underwater depth of 50 metres (m). Construction of the pipeline was successfully completed in August 2006, with Italy's Saipem as the contractor. The pipeline currently pumps 56.6mn cubic metres per day (Mcm/d) of gas, or 20.7bn cubic metres (bcm) per annum, but actually has a design capacity to transport 90.6Mcm/d (33.1bcm per annum).
