UAE's Dolphin says Abu DhabiFujairah gas pipeline completed
Platts, 30.11.2010
Dolphin Energy, a joint venture between the UAE's Mubadala, Total and Occidental Petroleum, said Tuesday it had completed construction of a 224-km pipeline linking Taweelah in Abu Dhabi with the emirate of Fujairah.
"This means that sufficient capacity is now available – 1.6 billion standard cubic feet of natural gas per day – to meet the requirements of Dolphin's largest customer, the Abu Dhabi Water and Electricity Company (ADWEC)," Dolphin said in a statement.
The 48-inch pipeline, which was built by Russia's Stroytransgaz and took three years to complete, "will deliver essential volumes of natural gas to Fujairah, where ADWEC has build two power stations to support industrial growth and development," Dolphin said.
The company worked closely with the International Petroleum Investment Corp (IPIC), to accommodate an oil pipeline that the state-owned investment company is building to link Abu Dhabi oil fields with Fujairah, thereby providing the UAE with an alternative export outlet bypassing the Strait of Hormuz at the mouth of the Persian Gulf.
Dolphin Energy Ltd, the only cross border energy project in the Gulf region, involves the production and processing of natural gas from Qatar's North Field, and transportation of the dry gas by subsea export pipeline from Qatar to the UAE, which began in July 2007.
The long term customers for Dolphin gas from Qatar are ADWEC, the Dubai Supply Authority DUSUP and the Oman Oil Co, which began taking Dolphin gas in 2008. Each has signed a gas supply agreement with Dolphin Energy for 25 years.
Dolphin Energy is owned 51% by Mubadala Development Company, on behalf of the Government of Abu Dhabi, and 24.5% each by Total and Occidental.
Dolphin currently receives 2 Bcf/d of natural gas through the pipeline to Abu Dhabi. The volume is below the design capacity of 3.2 Bcf/d and Dolphin has been trying, so far without success, to obtain additional supply from Qatar to fill the excess capacity and meet high demand for gas in the seven emirates that make up the UAE, particularly in Abu Dhabi, Dubai and Sharjah.
Dolphin said late last year it would be getting additional supply from Qatar on an interruptible basis when other international customers do not want full volumes.
Although the UAE, a major oil producing member of OPEC, has the world's fifth largest natural gas reserves, it has only recently started moving to develop its sour gas reserves to meet demand, which is estimated to be rising by 10% annually.
Dubai, the UAE's financial hub, last year signed an agreement with Shell and Qatar Petroleum to develop a floating LNG facility offshore to meet high demand in the summer months. The first cargo is believed to have been delivered in October.
Qatar, which holds the world's third biggest natural gas reserves after Russia and Iran, has imposed a moratorium on further exploitation of its huge North Field gas field while it conducts a study on the reservoir after a massive development drive that has turned the tiny emirate into the world's biggest LNG exporter. LNG capacity is set to rise to 77 million mt/year by the end of this year.
