ADNOC in US$3.6 Billion Offshore Decarbonisation Deal
Abu Dhabi National Oil Company (ADNOC) and Abu Dhabi National Energy Company PJSC (TAQA) have announced a US$3.6 billion project to “significantly” decarbonise ADNOC’s offshore production operations.
The project will see the development and operation of a first of its kind high-voltage, direct current (HVDC-VSC) subsea transmission system in the Middle East and North Africa region, the companies noted in a joint statement.
It will power ADNOC’s offshore production operations with cleaner and more efficient energy, delivered through the Abu Dhabi onshore power grid, which is owned and operated by TAQA’s transmission and distribution companies, the businesses outlined.
The development, which is expected to reduce the carbon footprint of ADNOC’s offshore operations by more than 30 percent, will be funded through a dedicated company which will be jointly owned by ADNOC and TAQA (30 percent stake each), and a consortium comprised of Korea Electric Power Corporation (KEPCO), Japan’s Kyushu Electric Power Company and Électricité de France (EDF).
Led by KEPCO, the consortium will hold a combined 40 percent stake in the project on a build, own, operate and transfer basis.
The consortium will develop and operate transmission system alongside ADNOC and TAQA, with the full project being returned to ADNOC after 35 years of operation, ADNOC and TAQA highlighted. The project is subject to relevant regulatory approvals.
“ADNOC is delighted to be collaborating again with TAQA, as we jointly welcome world-class industry leaders in yet another landmark transaction which will see ADNOC make a significant step forward in our ongoing decarbonisation journey,” Yaser Saeed Almazrouei, ADNOC’s upstream executive director, said in a company statement.
“As ADNOC embraces the energy transition, this bold and progressive project will replace our existing offshore local power supply with cleaner and more sustainable onshore power sources, significantly reducing our carbon footprint while enabling additional cost savings,” Mr Almazrouei added in the statement.
“This first of its kind project is a further example of how ADNOC is advancing practical and commercially viable solutions to secure a lower carbon future, while driving significant foreign direct investment, and, in turn, cementing Abu Dhabi and the UAE’s position as a trusted global investment destination,” he went on to say.
Jasim Husain Thabet, TAQA’s group chief executive officer and managing director, said, “as the recognised low carbon power and water champion of Abu Dhabi and one of the top five utilities in EMEA by market value, TAQA is pleased to again partner with ADNOC on such an important project that will contribute to the decarbonisation of Abu Dhabi’s energy industry in such an impactful way”.
“This first of its kind project shows how the UAE continues to demonstrate its strong leadership and innovation in the global energy transition by bringing together critical players to boost sustainability credentials and maximizing the utilization of Abu Dhabi’s diverse and efficient energy mix,” Mr Thabet added in the statement.
“Decarbonisation continues to provide social and economic opportunities for collaboration and growth, which TAQA is actively pursuing through its strategic alliances and partnerships in the market,” Mr Thabet continued.
Seung-il Cheong, the president and CEO of KEPCO, said, “It is truly an honour to participate in this strategic project with ADNOC”.
“As the Barakah Nuclear Power Project has become a token of long friendship and cooperation between the UAE and Korea, KEPCO will strive for the successful completion of this Project and contribute to the ‘2050 Net-Zero Initiative’ of the UAE,” Mr Cheong added.
On the 8th December, ADNOC announced a joint cooperation initiative with GE Gas Power to develop a decarbonisation roadmap which includes reducing carbon emissions from gas turbines used to power ADNOC’s downstream and industry operations, including at the Ruwais Industrial Complex.
Also in December, ADNOC revealed that it, TAQA and Mubadala Investment Company would partner under the Abu Dhabi Future Energy Company (Masdar) brand. With over 23 gigawatts (GW) of current, committed, and exclusive renewable energy capacity, Masdar is immediately positioned as one of the largest clean energy companies globally, ADNOC highlighted.
Source: Rigzone