Takreer awarded $2.47 billion on first half 2012

With the Ruwais Carbon black and delayed coker (CBDC) facilities, Abu Dhabi Refining Company (Takreer) awarded the only giant project in the UAE during the first half 2012.

This downstream project came after a long period without major capital expenditure in the UAE since the Borealis and Abu Dhabi Polymers Company $3 billion Borouge expansion in 2010.

Takreer awarded:

 - In June 2012, the Engineering, procurement and construction (EPC) contract for the Ruwais refinery carbon black and delayed coker to Samsung Engineering from South Korea for $2.47 billion

 - In July 2012, the Project Management Consultancy (PMC) contract to Jacobs Engineering.

These contracts are following the previous ones signed by Takreer with:

 - Bechtel for the Front end engineering and design (FEED)

 - WorleyParsons for the PMC of the FEED

According to its PMC contract, Jacobs will supervise the good execution of the Ruwais Carbon black and delayed coker designed with a capacity of:

 - 40,000 t/y of carbon black

 - 30,000 b/d of crude oil

With the EPC contract signed with Samsung and the PMC contract closed with Jacobs, Takreer expects the Ruwais carbon black and delayed coker refinery to be completed at the end of 2015.

$8 billion EPC to be contracted on second half 2012

In parallel of Takreer‘s downstream project, Abu Dhabi National Oil Company (ADNOC) was developing several large upstream projects these last years and maturing for final investment decision (FID) in 2012.

These oil and gas projects developments were driven by ADNOC to meet is allocated production quotas agreed within OPEC for 2017 in order to guaranty to the GCC countries to produce at least 40% of the global production by then.

The percentage of 40% has been defined by the GCC countries as the strategic level to maintain its Market Leadership on the barrel prices, thus to preserve their local economical growth.

In this context ADNOC is planning to increase its production from the current 1.1 million b/d to 1.75 million b/d representing a 90% increase in 5 years.

This leap will come from developing new fields as well as enhancing maturing fields, especially in combining  gas projects to boost the oil production.

In these context, ADNOC and its subsidiaries are planning to engage $8 billion in projects such as Upper Zakum EPC1 and EPC2, Umm al Lulu and Satah al Razboot (Sarb), Habshan -Taweelah to be contracted on the second half of 2012.

$800 million Adma-Opco and Zadco Upper Zakum EPC1 project

In July 2012, Abu Dhabi Marine Operating Company (Adma-Opco) and Zakum Abu Dhabi Company (Zadco) awarded the first package, called EPC1, of the offshore infrastructures of the Uppper Zakum oil and gas field.

This Upper Zakum EPC1 engineering, procurement and construction (EPC) contract went to the joint venture made of the local National Petroleum Construction Company (NPCC) and Technip from France.

The Upper Zakum EPC1 project represents $800 million capital expenditure and will be executed in NPCC and Technip Abu Dhabi office.

$2 – $4 billion Adma-Opco and Zadco Upper Zakum EPC2 project

The Upper Zakum EPC2 project is closely connected to the EPC1, as it includes all the offshore processing facilities and power generation to be integrated with EPC1 infrastructures.

This giant package is estimated between $2 and $4 billion capital expenditure.

Adma-Opco and Zadco expects to award the EPC contract for the Upper Zakum EPC2 before the end of the year.

$2 billion Adma-Opco Umm al Lulu and Satah al Razboot (Sarb)

The Umm al Lulu and Satah al Razboot (Sarb) offshore oil fields are part of the major offshore oil fields to be developed to help ADNOC to meet its 2017 oil production targets.

The Umm al Lulu and Satah al Razboot (Sarb) oil field development project is divided in four packages plus the civil work.

These four EPC contracts should be awarded for a total capital expenditure around $2 billion.

Adma-Opco is working on it to close these EPC contracts for Umm al Lulu and Satah al Razboot (Sarb) before the end of 2012. 

$450 million GASCO Habshan – Taweelah gas pipeline

Abu Dhabi Gas Industries (GASCO) is currently evaluating the commercial quotations submitted by the engineering companies for the EPC contract of the Habshan – Taweelah gas pipeline.

This pipeline project is to transport the natural gas delivered by the gas processing facilities located in Habshan to the Taweelah industrial zone.

GASCO has budgeted $450 million capital expenditure for this EPC contract to be awarded soon.

The local UAE Dodsal is reported to lead the competition for this Habshan – Taweelah gas pipeline.

After a long standing downstream development in UAE, ADNOC and its subsidiaries ADCO, GASCO, ZADCO and Adma-Opco are planning to boost its upstream and midstream sectors through a program of 16 major projects beginning with Upper Zakum, Umm al Lulu and Satah al Razboot (Sarb) and Hashan – Taweelah.

For more information and data about oil and gas and petrochemical projects go to Project Smart Explorer

Larsen & Toubro wins Oman PDO Saih Rawl phase 2

>On August 27th 2012, Petroleum Development Oman LLC (PDO) awarded to Larsen & Toubro from India the engineering, procurement and construction (EPC) contract for the Saih Rawl Depletion Compression Phase 2 (SRDC2) project.

Nine engineering companies were in competition to win this order of $235 million.

The Saih Rawl gas field is located in Center Oman where PDO started operations in 1991 with a large gas Central Processing Facility (CPF).

Then the natural gas is piped to the LNG Trains located at Qahlat for export and Sur Fertilizer plant.

After years of production the Saih Rawl gas field is maturing and losing a part of its natural pressure.

PDO invested $550 million in the Saih Rawl Depletion Compression phase 1 (SRDC1) project to boost Saih Rawl gas field in using the depletion compression process.

The depletion compression is reducing the back-pressure at the wellhead to boost the gas inlet pressure from 35 to 96 bar for export.

Anyway and despite the installation and commissioning of the Saih Rawl Depletion Compression phase 1 last year, the natural depletion of the Saih Rawl gas field continues so that the inlet pressure at the CPF should come down to 13 bar by 2015.

In that perspective PDO anticipates with Saih Rawl Depletion Compression phase 2 project.

In its EPC contract Larson & Toubro‘s scope of work includes:

 - 4 parallel compression trains of 76 MW for a total capacity of 30 million standard cubic meter per day (mmscmd) of gas

 - Modifications of the condensate handling system at the Saih Rawl CPF

 - Installation of a pair of inlet separators for a total capacity of 18 mmscmd

PDO and Larsen & Toubro are planning the completion of the Saih Rawl Depletion Compression phase 2 project in 2014.

Larsen & Toubro aims at Qatar Dolphin gas compression

Larsen & Toubro is one of the six engineering companies in competition for the Dolphin Energy Ltd (Dolphin) gas compression expansion project in Ras Laffan Indusrial City in Qatar.

Created in 1999, Dolphin is a joint venture based in Abu Dabi, UAE, between:

 - Mubadala, a wholly owned Abu Dhabi Government national oil company (NOC), 51%

 - Total from France 24.5%

 - Occidental Petroleum from USA 24.5%

If the Abu Dhabi Emirate is rich of oil, it is short of natural gas.

With a local natural gas demand increasing for power generation, gas injection and petrochemicals applications, Abu Dhabi created Dolphin Energy to treat and export natural gas from Qatar to the UAE.

In the agreement between Qatar and Abu Dhabi, the raw natural gas is processed in Ras Laffan Industrial City to produce:

 - Natural gas (methane) exported to the UAE

 - Ethane used as feedstock locally for the Ras Laffan petrochemical industry

 - other NGL such as propane and butane for international trading.

In 2007, JGC from Japan built up the first Dolphin gas compression facility with capacities of:

 - 110,000 b/d of condensate

 - 4,400 t/d of ethane

 - 2,800 t/d of propane

 - 1,800 t/d of butane

Now Dolphin is planning the expansion of the existing Ras Laffan gas central processing facility (CPF).

The expansion of Dolphin Ras Laffan gas CPF is supposed to include:

 - Gas compression facility of 1 billion cf/d additional capacity of natural gas

 - Upgrade Ras Laffan Dolphin utilities

 - Piping and hydraulic work

This expansion is to match with the available capacity of the 364 kilometer gas pipeline connecting Qatar to the UAE across the Arabian Gulf.

Designed and installed by Saipem in 2006 for a capacity of 3.2 billion cf/d of natural gas, the Dolphin gas pipeline is currently operated at 2 billion cf/d.

The Dolphin Ras Laffan gas compression project is to fill up the capacity of the Dolphin gas pipeline with this addition 1 billion cf/d expansion. 

With capital expenditure estimated around $250 million, Dolphin is planning the completion in 2015.

After winning the Lekhwair Gas Field Development project  and the Saih Rawl Depletion Compression phase 2 project, both from PDO, Larsen & Toubro is targeting the Dolphin gas compression expansion EPC contract against its main competitors Dodsal and Punj Llyod from India, GS engineering & Construction from South Korea, Saipem from Italy and Technip from France. 

For more information and data about oil and gas and petrochemical projects go to Project Smart Explorer

Committed to one thing above all: Excellence

Qatar Petroleum (QP) was established in 1974 as wholly state-owned corporation.

As a national oil company (NOC), QP is fully upstream-downstream integrated in order to manage all the phases of the oil and gas industry in Qatar.

In that respect Qatar Petroleum directly or through its subsidiaries and joint ventures covers:

 - Exploration, drilling and development operations

 - Production and transformation

 - Transportation and storage

 - Marketing and sales

Through all these operations Qatar Petroleum handle one of the world largest portfolio of products with:

 - Crude oil

 - Liquefied Natural Gas (LNG)

 - Natural Gas Liquids (NGL)

 - Gas -To-Liquids (GTL)

 - Refined Products

 -  petrochemical Products

 - Fertilizers

 - Helicopter Services

 - Financial Services

Contractually Qatar Petroleum is partnering with international oil companies with two types of contracts:

 - Exploration and Production Sharing Agreements (EPSA)

 - Development and Production Sharing Agreements (DPSA)

Qatar Petroleum onshore operations are concentrated in Doha, Dukhan, Mesaieed and Ras Laffan industrial cities.

Offshore, the production stations are installed on the Halul Island, while the drilling platforms covers the North Gas Field.

Holding an estimated 900 trillion cubic feet of reserves, the North Field, located offshore Qatar in the Arabic Gulf, is the world’s biggest natural gas deposit.

Production from the North field started in the 1990s and grew up to propel Qatar as the world largest exporter of gas by pipeline or in the form of LNG.

The development of the oil and gas projects in Qatar in the 2000s over speed some how the whole country infrastructures so that Qatar had to decide a moratorium in 2005 to freeze all new offshore developments from the North field in order to leave time to the country to digest so much changes in a so short period of time.

Overseas, Qatar Petroleum has interests in Algeria with Sonatrach and in USA with ExxonMobil for export LNG project.

Qatar Petroleum Key Figures

- 2011 Revenues: $79,4 billion

 - 2010 Revenues: $51,6 billion

 - 2009 Revenues: $32,4 billion

 - 2011 Earnings: $24,4 billion

 - 2010 Earnings: $14,9 billion

 - 2009 Earnings: $9,6 billion

 - 2011 Capital Expenditure: $9 billion

 - 2010 Capital Expenditure :$6,7 billion

 - 2009 Capital Expenditure: $9,7 billion

Qatar Petroleum Projects and Business Highlights

Originally planned to apply until 2013, the moratorium affecting the exploration and production of the North gas field was mostly driven by an internal agenda to give a chance to Qatar to cope with all the changes due to the quantity, size and complexity of all the oil and gas and  petrochemicals projects to be implemented in the same time.

Today the infrastructures in Qatar are among the best in the world and could easily afford new projects, but the natural gas market has drastically changed in the meantime with the surge of the shale gas in USA.

Until 2009, ExxonMobil was the largest investor in Qatar jointly with Qatar Petroleum and was planning tens of LNG import terminal on the east coast of North America.

Today these LNG terminals are re-designed to be converted into export terminals such as the Golden LNG project in Port Arthur, Texas, USA, where Qatar Petroleum holds 70% interests.

This new context, pushes Qatar Petroleum to go global through strategic investment in energy and petrochemical projects overseas.

Qatar Petroleum manages these expanding activities through its international division – Qatar Petroleum International (QPI).

In parallel, Qatar Petroleum contributes to the implementation of Qatar National Vision 2030.

This scheme was drawn up to guide a responsible exploitation of Qatar’s oil and gas resources.

In practice it means for Qatar to maintain a balance between reserves and production, 

In this perspective and in respect with the surplus of upstream capacities compared with downstream, all the major projects in Qatar are related to downstream with projects such as Ras Laffan Refinery Expansion, Ras Laffan Aromatics, QP-Shell Petrochemicals,  QP-Qapco Petrochemicals.

On the midstream, Qatar Petroleum is planning the expansion of Dolphin to increase capacity to the UAE and Oman.

After the years 2000s of unleashed capital expenditure to feed the world with energy, Qatar envisions wise investments in high added value activities to reduce its reliance on natural gas and favor the generation of advanced technologies and the provision for clean energies.

For more information and data about oil and gas and petrochemical projects go to Project Smart Explorer

Third largest US oil and gas company by equity

Home based in Los Angeles, California, USA, Occidental Petroleum Corporation (Oxy) is listed in New York Stock Exchange since 1964 and is operating as an international oil company.

With more than 40,000 employees, Oxy focuses its oil and gas operations in three core regions of the world:

 - USA

 - Middle East/North Africa

 - Latin America.

On upstream, Oxy competitive advantage relies on its unique expertise to explore hard-to-reach reserves and to enhance production from maturing and depleting oil and natural gas fields.

Based on this know-how, Oxy manages to consistently replace and expand its proven reserves through improved oil recovery (IOR), strategic acquisitions and selective exploration.

Oxy is the largest natural gas producer in California and mobilized its expertise to become the first producer of oil in the Permian basin across Texas and New Mexico.

In the Middle East Oxy is developing heavy crude oil in Oman and is the second largest oil producer in Qatar Arabo-Persian Gulf.

In addition to its oil and  gas exploration and production company, Oxy owns large Midstream activities and runs petrochemical operation through its subsidiary Oxychem.

Oxy’s Midstream and Marketing businesses covers all the value chain to gather, treat, store, transport and trade energies such as crude oil,natural gas, condensate, CO² and power.

Oxy’s Midstream also trades pipeline and storage capacities, commodities and securities.

Among its key Midstream assets, Oxy is partnering in the giant Dolphin gas project connecting Qatar to the UAE and Oman, one of the longest pipeline across Middle East.

In petrochemicals, Oxychem is a major player in North America with a leading position in:

 - Vinyl Chloride Monomer (VCM) and Polyvinyl chloride (PVC) resins

 - Chlorine and caustic soda

 - Other key building blocks for plastics, pharmaceuticals and water treatment chemicals.

In every product of its portfolio, Oxychem strategy is to be market leader or second best.

Oxychem is the world’s largest producer of caustic potash and calcium chloride.

Occidental Petroleum Key Figures

 - 2011 Revenues: $23,9 billion

  – 2010 Revenues: $19 billion

 - 2009 Revenues: $14,8 billion

 - 2011 Earnings: $6,7 billion

 - 2010 Earnings: $4,5 billion

 - 2009 Earnings: $2,9 billion

 - 2011 Capital Expenditure: $7,5 billion

 - 2010 Capital Expenditure: $3,9 billion

 - 2009 Capital Expenditure: $3,2 billion

Occidental Projects and Business Highlights

Oxy maintains a high level of capital expenditure based on solid financial performances and a development programs focused on large, long-lived oil and  gas assets with long term growth potential, and acquisitions.

These financial performances are supported by an advanced expertise in oil and  gas field development pushing beyond the common practices the recovery rates in its assets.

In this area, Oxy intends to continue to invest into key differentiating technologies:

 - Reservoir description and modeling

 - New well drilling

 - Field automation

 - Artificial Lift

 - CO² based Enhanced oil recovery (EOR) techniques

In addition, to these operational aspects Oxy selects oil and gas fields in low risk areas such as North America, Middle East, South America, yielding superior results.

In that respect, Oxy took 40% interest in the $10 billion Al Hosn Gas project in Abu Dhabi, UAE, in joint venture with Abu Dhabi National Company (ADNOC). 

This project is not only critical by it size, one of the largest  gas field in Middle East, but is also strategic for Abu Dhabi running short of natural gas and for Oxy to position itself in the perspective of the renewal of the onshore concessions in 2014.

In USA, Oxy is launching a four years program to develop the Californian shale gas in the Ventura basin and the San Joaquin basin containing 20 billion barrels of oil equivalent (boe) in place.

On the petrochemical side, Oxychem is working on the feasibility study of a $1 billion ethane cracker expansion on its site  of Ingleside, Texas, in joint venture with Mexichem.

For more information and data about oil and gas and petrochemical projects go to Project Smart Explorer

Abu Dhabi converts Fujairah into oil and gas hub

The Abu Dhabi investment funds International Petroleum Investment Company (IPIC) and Mubadala Development Company (Mubadala) are leading more than $10 billion capital expenditure into midstream and downstream projects in Fujairah.

With direct access to the Gulf of Oman, Fujairah occupies a strategic position for Abu Dhabi and the United Arab Emirates (UAE) in short-cutting the Strait of Hormuz and its potential risks of lockout.

IPIC made the first step with the Abu Dhabi Crude Oil  Pipeline (Adcop) to connect Abu Dhabi onshore oil fields in Habshan to Fujairah.

With 370 kilometers and for $3.3 billion capital expenditure, this crude oil pipeline was commissioned in July.

To supply the actual and future storage farms in Fujairah, the Adcop pipeline has a capacity of 1.5 million b/d allowing additional expansions in Fujairah.

While Abu Dhabi works to secure its oil export, the UAE strategy is also to increase their local added value on the crude oil.

In this context IPIC plans to build the Fujairah refinery and petrochemical complex.

This project will be developed in two phases where Fujairah:

 - Phase 1 includes only the refinery

 - Phase 2 will add an olefin plant

On the phase 1, IPIC is moving on with the Fujairah refinery to require $3.5 billion capital expenditure for 200,000 b/d of crude oil capacity.

The Shaw Group completed the  pre-front end engineering and design (feasibility study) on early 2012 and has been awarded the Project Management Consultancy (PMC) contract.

Then IPIC selected the French engineering company Technip to perfom the front end engineering and design (FEED).

With Technip due to complete this FEEDon first half 2013, IPIC is targeting the completion in 2016 in order to transform Fujairah into oil products export platform.

IPIC and Mubadala build Fujairah LNG import terminal

If Abud Dhabi is rich of oil, it is short of gas and the expansion of the Dolphin capacities in Qatar to supply Abu Dhabi is the first answer to the increasing needs of natural gas of the UAE.

In addition to secure the export of crude oil and derivatives products, IPIC and Mubadala are planning the infrastructures to guaranty the long term import of natural gas in UAE.

The population in UAE is growing and the profile of the industry is also evolving with the integration of aluminium and steel sectors boosting the power consumption.

In addition Abu Dhabi maturing oil fields request more assistance of gas injection leading the UAE to be more import dependent on gas supply.

In their joint venture, IPIC and Mubdala are planning an offshore liquefied natural gas (LNG) import terminal in Fujairah.

Designed with offshore storage capacities and regasification units, the Fujairah LNG import terminal will be built in two phases.

To proceed on fast track, IPIC and Mubadala have already initiated the first phase with a capacity of 4.5 million t/y (600 million cf/d) of  LNG.

The engineering company Poten & Partners completed the pre-FEED on first half 2012 so that the FEED could be tendered in following.

IPIC and Mubadala awarded the FEED contract to Technip in expecting to allocate the engineering, procurement and construction (EPC) contract in 2013 for the completion in 2015.

The second phase should follow closely to run into commercial operations by 2016.

With all the on going projects to increase storage capacity in Fujairah, IPIC and Mubadala will contribute to reduce the traffic of the tankers in the Strait of Hormuz in securing the Abu Dhabi export and import of oil and gas when the Fujairah refinery and offshore  LNG terminal will run into commercial operations in 2015.

For more information and data about oil and gas and petrochemical projects go to Project Smart Explorer

An international oil and gas company 

Based in Vienna, OMV Aktiengesellschaft  (OMV) is one of Austria’s largest listed industrial companies with 29,800 employees in 2011

Historically, OMV is an integrated upstream-midstream-downstream company with activities mostly concentrated in Europe.

Upstream, OMV explore and produce oil and gas in Romania and Austria and holds working interests all over the world.

In 2011, OMV produced 288,000 barrel of oil equivalent (boe) and accumulated 1.13 billion boe of crude oil and natural gas.

Midstream, OMV operates a gas pipeline network in Austria of 2,000 kilometers long.

In 2011, OMV transported 101 billion cubic meter of natural gas across the country and sold for its own account 24 billion cubic feet of gas.

This large network of pipelines is also providing OMV with the largest natural gas trading hug in Central Europe.

Downstream, OMV is refining crude oil and distributing gasoline through a network of 4,500 retailers covering 13 countries.

In 2011, OMV processed 22.5 million tonnes of crude oil in its refineries.

On the petrochemical side OMV has no direct activities but is deeply engaged through capitalistic links.

The International Petroleum Investment Company (IPIC), the sovereign found of Abu Dhabi holds 24.9% stakes in OMV, being the reference shareholder.

Through this equity connection, IPIC and OMV are the co-owners of the chemical company Borealis which established the Abu Dhabi polymers company called Borouge, the largest  petrochemical complex in UAE.

With such solid reference stakeholder as IPIC, the new OMV Executive Board presented in September in Istanbul its Strategy 2021 for “Profitable Growth” through:

 - Improved financial performances across the entire group

 - Monetization of the natural gas value chain in strengthening the Baumgarten gas hub and the Central European Gas Hub (CEGH) trading platform

 - Converting cheap gas into valuable electricity with power plant projects such as Brazi in Romania, Haiming in Germany, Samsun in Turkey

 - OMV leadership in the 1,300 kilometers long Nabucco gas pipeline project from the Caspian Sea to Austria for which the  Shah Deniz Consortium will announce its final decision on the route in mid-2013

 - Increasing the upstream portfolio to absorb about two-thirds of OMV’s capital expenditure in oil and gas exploration and production with a focus in the Caspian Sea, North Sea, UAE and Africa.

For these reasons OMV is actually:

 - Performing tests in the Shuwaihat sour gas field for ADNOC in UAE 

 - Positioning itself for the renewal of the concessions in Abu Dhabi in 2014

 - Operator of the Bina Bawi oil field in the Kurdistan region of Iraq

 - Involved in large and complex projects such as Aasta Hansteen with Statoil and Rosebank with Chevron, both in the North Sea.

Shaping The Future

Established in 1894 in Germany for drilling and mining potassium salt, Wintershall started the oil production in 1930 and joined the chemical group BASF in Ludwigshafen as a wholly-owned subsidiary in 1969.

Based in Kassel, Germany, Wintershall is the largest German crude oil and natural gas producer and operates the largest network of pipelines in Germany in joint venture with Gazprom.

Upstream, Wintershall has exploration and production interests in 35 countries in Europe, North Africa, South America, Russia, the Caspian Sea region, and the Middle East.

Among all these regions Wintershall concentrates on two countries, Norway and Russia, because of their large oil and gas reserves and the existing links to the markets of Western Europe.

Focusing on the North Sea, Wintershall started inorganic growth on upstream with the acquisition of the Dutch natural gas producer Clyde Netherlands in 2002 and the Norwegian Revus Energy in 2008. 

As a result in the past five years, Wintershall was involved in six of the twelve biggest oil discoveries made in Norwegian Continental Shelf (NCS).

Midstream, Wintershall and Gazprom signed their first partnership agreement to import and distribute Russsian natural gas in Eastern and Western Europe in 1990.

This partnership was expanded and converted in 1993 into the Wingas joint venture as a natural gas trading company to supply utilities, industrial companies, cities in Germany and Western Europe.

Wintershall Key Figures 

 - 2010 Revenues: $14 billion

 - 2009 Revenues: $14,7 billion

 - 2010 Earnings: $3 billion

 - 2009 Earnings: $2,9 billion

 - 2010 Capital Expenditure: $1,28 billion

 - 2009 Capital Expenditure: $1,31 billion

Wintershall Projects and Business Highlights

Under the impulsion of BASF, Wintershall is moving upward in the upstream activities.

Onshore, Wintershall is planning to:

 - Expand the development of the Achimgas field in Siberia in joint venture with Gazprom

 - Engage new exploration activities in Argentina

 - Test new processes with the Shuwaihat sour gas field with ADNOC in Abu Dhabi, UAE.

Offshore, the swap of assets signed with Statoil in October 2012, will give Wintershall the opportunity to:

 - Take its first operatorship of a large offshore plaform (Brage) in the Norwegian North Sea

 - Increase by ten times its production from the Norther Sea to 40,000 barrels of oil equivalent (boe) per day.

Midstream, Wintershall through its partnership with Gazprom will take a leading role in the giant Nord Stream and South Stream gas pipelines projects under construction to provide Europe with the cleanest fossil fuel.

Germany having decided to stop the nuclear power plants, and testing the limits of the renewable energies, may see the natural gas a the only viable and sufficient source of energy to substitute the coal-fired power plants providing 60% of the energy consumed in Germany.

As for many German companies, Wintershall believes the technology to be the key for the future.

Together with its mother company, BASF, Wintershall develops new solutions based on shizophyllan fungus for enhanced oil recovery (EOR) applications.

After testing this bio-technology in onshore fields, Wintershall will experiment it offshore together with Statoil through their technical cooperation agreement signed in October 2012 for the EOR applications.

For more information and data about oil and gas and petrochemical projects go to Project Smart Explorer

To be a world-leading Energy and Chemical Company

China Petrochemical Corporation (Sinopec Group) was established in July 1998 on the basis of the former China Petrochemical Corporation.

Sinopec Group is a state wholly owned company with Headquartered in Beijing, China and a registered capital of RMB 182 billion ($30 billion).

As a state-owned company, Sinopec Group operates, manages and supervises state oil and gas and petrochemical assets in order to maintain and increase the value of these assets.

In its leading national role, Sinopec Group controls and manages China Petroleum & Chemical Company (CPCC or Sinopec Corporation).

As a brand, Sinopec refers to both Sinopec Group and Sinopec Corporation.

In 2000 and in 2001, Sinopec Group issued shares of Sinopec Corporation, H-shares and A-shares overseas and home respectively, in order to list Sinopec Corp. in Hong Kong, New York, London and Shanghai Stock Markets.

From this public offering, Sinopec Corp. capital is owned by:

 - Sinopec Group 75.84%

 - International investors 19.35%

 - Domestic investors 4.81%.

Sinopec is the second largest Chinese national oil company after PetroChina (CNPC) and among the Top 5 largest companies in the world according to Fortune ranking 2011.

If Sinopec is a fully integrated company, as most of the national oil companies,with operations upstream, midstream and downstream.

Historically Sinopec business gravity is more downstream, especially in refining and following petrochemical transformations with main operations in China.

Upstream, Sinopec is China’s second largest oil and gas producer and is developing its exploration and production activities overseas in order to provide China with the necessary oil and gas feedstock to run the economy.

In conventional oil and gas exploration and production, Sinopec operates 12 major: East China Company, Exploration Southern Company, Henan Oilfield Company, Jianghan Oilfield Company, Jiangsu Oilfield Company, Northeast Oil & Gas Company, North China Company, Northwest Company, Shanghai Offshore Oil & Gas Company, Shengli Oilfield Company, Southwest Oil & Gas Company, Zhongyuan Oilfield Company.

Sinopec is also exploring and developing the unconventional oil and gas with tight oil and shale gas fields in the Ordos Basin, Shengli Oilfield, Sichuan Basin and Tarim Basin.

Downstream Sinopec is the first refining and petrochemical company in China and runs the 2nd largest refining capacities and 4th largest ethylene production in the world.

With most of the imported crude oil is delivered in China by sea, most of Sinopec refineries and associated petrochemical complex are located on the southeastern coast.

From its huge refining activities, Sinopec developed the largest petrochemical industry in China and is running the largest network of retailer  with more than 30,000 gas stations in the country.

In addition to its core business as operator, Sinopec is also the largest engineering company in China for the oil and gas and petrochemical applications.

Based on the historical model of the Chinese Institutes, most of these local engineering companies have been integrated in Sinopec to provide engineering and services to Sinopec and other oil and gas companies such as PetroChina, CNOOC, or foreigners.

The other distinctive activity we can find in Sinopec compared with other international or national oil companies is its integrated geophysical prospecting, drilling, well logging, mud logging, downhole operation, oilfield facility construction and machinery manufacturing, with more than 2,400 crews in operations all over the world. 

Having a global leading role with interests in all continents, especially in Canada, USA, South America, Africa, Iraq, Gulf countries, Asia, Sinopec employs 135,000 skilled people.

Sinopec Key Figures

 - 2011 Revenues: $397,7 billion

 - 2010 Revenues: $303,6 billion

 - 2009 Revenues: $213,5 billion

 - 2011 Earnings: $16,2 billion

 - 2010 Earnings: $16,2 billion

 - 2009 Earnings: $13,6 billion

 - 2012 Capital Expenditure: 12.4 billion

Sinopec Projects and Business Highlights

Sinopec, as the other China national oil companies, PetroChina and CNOOC, have the simple mandate to:

 - Explore oil and gas all over the world

 - Bring in back to China under any form (crude oil,LNG, natural gas, condensate) by pipelines and ships.

 - Develop locally a dynamic petrochemical industry covering all the basic chemical products and opening ways further downstream to high performances derivatives

Fully integrated, including with geophysics, drilling and engineering activities, Sinopec strategy is not driven by the spot market of the oil and gas.

Sinopec is working to identify largest unlocked quantities of conventional or unconventional oil and gas and find the shortest way to monetise it along the internal supply chain.

Oil sands and shale gas are part of these resources where Sinopec sees opportunities for exploration abroad but also in China.

In practice Sinopec invest 50% of its capital expenditure upstream, the other 50% are split to improve operational performances downstream or develop new high performances hydrocarbons products.

Upstream Sinopec’s largest investment will continue in oil sands Canada, Sichuan in China and Iraq

Downstream Sinopec major projects are related to the joint ventures with:

 - Sabic for the Tianjin Polycarbonate project and for the Methanol-To-Olefins project in Trinidad and Tobago

 - BASF for the Nanjing expansion project and Maoming Isononanol project.

 - Sibur for synthetic rubber project in Shanghai and in Russia

 - Mitsui for ETP project in Shanghai

 - Total for the Zhanjiang complex project

As engineering company, Sinopec will extend its contracting business in targeting engineering, procurement and construction (EPC) contracts in Brunei, Saudi Arabia, UAE and Oman

BP and CNPC ramped up oil production 10% per year 

In June 2009, the international oil company BP and the China National Petroleum Company (CNPC or PetroChina) were awarded the technical services contract (TSC) for the giant Rumaila oil field in the south of Iraq, closed to the Kuwait border.

BP discovered the Rumaila oil field in 1953, but had to drop it by the nationalization under Saddam Hussein’s reign.

With estimated reserves in place of 17 billion barrels and covering 80 kilometers long by 20 kilometers wide, the giant Rumaila represents 12% of Iraq total reserves and ranks as the fourth largest crude oil field in the world.

After the war, when the Iraq Government organized the licenses rounds, BP and PetroChina won the technical services contract with a remuneration fees of $3.99 per barrel.

But after further negotiations with Iraq Government, the TSC was signed on a base of $2 per barrel remuneration fees.

At that time the Rumaila oil field production was just exceeding 1 million b/d.

From this reference of 1.066 million b/d, BP and PetroChina were given two targets:

 - Increase production by 10% the first year to trigger the payment of the $2 remuneration fees

 - Reach the plateau production of 2.8 million b/d within the next six years

To support this plan, the capital expenditure to develop Rumaila was estimated to $15 billion where the partners involved share working interests such as:

 - BP 38% is the operator

 - CNPC 37%

 - State Oil Marketing Organization (SOMO) 25%

BP to adjust production to Iraq infrastructure capacities

BP and CNPC awarded the front end engineering and design (FEED)contract and the project management services (PMS) contract to WorleyParsons mobilizing its offices in London, UAE and Iraq for execution.

In 2010, BP and CNPC awarded a $500 million contract to a consortium made of Weatherford, Schlumberger, Drilling Co. and Daqing Oil field Company Limited to proceed to a drilling campaign.

In 2012, BP and CNPC are confident to reach 1.35 million production on yearly base and to maintain a capacity of 1.4 million b/d capacity of production.

From this experience, BP and PetroChina consider to be able to increase production with additional 100,000 b/d every year on the next three years to reach 1.7 million b/d.

But this volume of 1.7 million b/d production appears to BP and PetroChina as the maximum possible within the limits of the actual infrastructures capacities to export the oil.

In this context any further capital expenditure from BP and PetroChina to reach the targeted level of 2.8 million b/d must be considered not in respect with the limits of the Rumaila project itself but according to the capabilities of the future export infrastructures to accept additional production capacities.

To move forward, BP and CNPC are working on multi-stages scenarios of Rumaila full-field development to set a new target for plateau production between 1.7 million b/d and 2.8 million b/d.

BP and CNPC will submit these scenarios to the Oil Ministry and the South Oil Company in charge of the assets in the South of Iraq in order to evaluate the consecutive investments to be made in infrastructures to be able to export the proposed production from Rumaila oil field.

From the SPE conference which took place during ADIPEC last week in Abu Dhabi, the figure of 2 million b/d was reported as a reasonable target for BP and CNPC while affordable by Iraq Authorities to finance infrastructures capital expenditure.

Once the new target approved, BP and CNPC will be able to adjust their capital expenditure to ramp up production accordingly in beginning with the replacement of the oil and gas processing facilities. 

For more information and data about oil and gas and petrochemical projects go to Project Smart Explorer

Abu Dhabi Company for Onshore Oil  Operations

The Abu Dhabi Company for Onshore Oil Operations (ADCO) was established on 2nd December 1971 in Abu Dhabi, the largest Emirates from the United Arab Emirates (UAE).

ADCO was created by the Abu Dhabi National Oil Company (ADNOC) to explore and operate the onshore and shallow coastal water of the Emirate of Abu Dhabi.

ADNOC is the national oil company held by the Abu Dhabi Government to manage all the oil and gas assets of the Emirate, upstream, midstream and downstream.

First oil and gas concessions were signed in Abu Dhabi in 1939 with Petroleum Development (Trucial Coast) Ltd, but the exploration started only in 1950 with the first discovery made in the actual Bab field.

ADCO was incorporated as a joint venture on 1978 and has been responsible, since February 1979, for onshore Abu Dhabi operations in the concession area covering more than 21,000 square kilometers.

In ADCO, ADNOC is leading the joint venture where the working interests are shared between:

 - ADNOC 60% is the operator

 - BP 9.5%

 - ExxonMobil 9.5%

 - Shell 9.5%

 - Total 9.5%

 - Partex 2%

With its onshore oil and gas fields mandate, ADCO explores and develops six oil and associated gas fields such as Asab, Bab, Buhasa, Sahil, Shah, North-East Bab (NEB) with Dabbiya, Rumaitha and Shanayel, 

With these six fields, ADCO  delivers 65% of the UAE total crude oil production of 2.5 million barrel of oil equivalent (boe) per day.

Under the govern of its stakeholders, ADCO defines its mission to explore, develop and produce hydrocarbons within its concession with the:

 - Maximum efficiency and safety

 - Optimum cost

 - Minimum impact on the environment

 - Continuous improvement

 - Highest standards of honesty and integrity.

ADCO Key Figures

As a national oil company ADCO does not published results.

In 2012, ADCO produces 1.4 million barrel of oil equivalent (boe) per day.

ADCO Projects and Business Highlights

Among the key projects ADCO is working on:

 - NEB Full Field Development including the deployment of CO2 injection techniques tested on the Rumaitha pilot case to reach 230,000 b/d production in 2016.

 - Nitrogen Gas Injection (NGI) in Thamana F

 - Bab Gas Compression Project phase 2 to boost production from the Bab field to 2.5 billion cf/d of natural gas

  – Asab Full Field Development to increase production from 290,000b/d to 340,000 b/d of crude oil.

 With the support of its actual partners BP, ExxonMobil, Partex, Shell, Total or potential new ones, OMV, Statoil and Wintershall, ADCO will have to invest massively to overcome two challenges: increase crude oil production to meet OPEC quotas, and find gas wherever possible to secure Abu Dhabi independence. 

For more information and data about oil and gas and petrochemical projects go to Project Smart Explorer

WorleyParsons to provide project management services

November 2012, OAO Lukoil (Lukoil) selected the Australian engineering company WorleyParsons to provide project management services (PMS) on the next three years for the West Qurna-2 oil field development project in southern Iraq.

Discovered in 1973, the West Qurna-2 oilfield is the second largest undeveloped field in the world.

Located 65 kilometers northwest of Basra, West Qurna-2 holds 14 billion barrels of oil equivalent (boe) mostly concentrated in two pay grounds: Mishrif and Yamama.

Lukoil in joint venture with Statoil and the local North Oil Company had won the reverse auction on West Qurna-2 during the second license round in December 2009.

The Technical Services Contract (TSC) was signed on the base of $1.15 per barrel remuneration fee.

In June 2012, Statoil decided to withdraw from the joint venture to concentrate on its own projects in the North Sea.

Actually, this West Qurna-2 joint venture is shared between:

 - 75% Lukoil is the operator

 - 25% North Oil Company

Since then, Lukoil is looking for partners to replace Statoil but the amount of the required capital expenditure and low remuneration fee limit potential candidates.

Lukoil awarded main EPC packages for West Qurna-2

Lukoil is committed to reach 1.8 million b/d at plateau production in 2017 for an investment of $25 billion capital expenditure on the period and 500 wells to be drilled.

This plateau production should be ramp up in two phases: Early Oil and Full Development.

The Early Oil should start in 2013 with 150,000 b/d production to end up in 2016 with 800,000 b/d.

Then the Full Development should add 1 million b/d.

In selecting WorleyParsons, Lukoil expects support from the design engineering to the commissioning for:

 - Project Management

 - Technical and construction supervision

 - Engineering, procurement and construction (EPC) activities. 

In March 2012, Lukoil had awarded three major  Engineering, procurement and construction (EPC) contracts:

 - Samsung Engineering, from South Korea, the oil and gas gathering system, the central processing facility, the well pads and the water treatment plant  to be delivered in 2015

 - Entrepose Projects/Rosco from France and Jordan for the expansion of the tank farm at the Tuba oil export terminal inclduing three storage tanks of 66,000 cubic meters each to be delivered in 2014.

 - ENKA Insaat, from Turkey, the gas-fired power plant with three GE bi-fuel gaz turbines of 42MW each, the gas treatment plant including the compressors, the diesel fuel loading storage and distribution system,, the power distribution system, the step downs transformers, switchgears and diesel generators to be delivered in 2014.

With the main EPC  packages awarded to Samsung Engineering, Entrepose, and ENKA Insaat, WorleyParsons will execute its project management services contracts for Lukoil West Qurna-2 contract from its offices in Iraq and in the UAE and from the offices of the appointed contractors.

 For more information and data about oil and gas and petrochemical projects go to Project Smart Explorer

Zakum Development Company

The Zakum Development Company (ZADCO) was established in the Abu Dhabi Emirate, as part of the United Arab Emirates (UAE), in November 1977 to develop and operate the Upper Zakum (UZ) field.

At that time ZADCO was a joint venture between:

 - Abu Dhabi National Oil Company (ADNOC) 88%

 - Japan Oil Development Corporation (JODCO) 12%

The Upper Zakum field is different from Zakum field, developed and operated by the sister company, Abu Dhabi Marine Operating Company (ADMA-OPCO).

Until then, ADMA-OPCO was the solely company within ADNOC to explore and produce oil and gas from the Abu Dhabi offshore fields.

Located 80 kilometers northwest of Abu Dhabi, Upper Zakum is the second largest crude oil field in the Gulf and the fourth largest in the world.

Because of its size and complexity the development of Upper Zakum was calling for massive capital expenditure over at least 25 years.

For these reasons, when ADNOC decided to proceed with the first phase of development of Upper Zakum in 1977, some of the partners in joint venture in ADMA-OPCO, such as ADNOC and JODCO expressed their intention to be part of it while BP and Total preferred to stand where they were in term of engagement in the UAE.

So ZADCO started operations with only ADNOC and JODCO shareholders but the changes in the partners to develop the offshore oil and gas fields requested ADNOC to create the new ZADCO joint venture to host the new partners.

Then in 2006, ADNOC was planning a large expansion for which ADNOC and JODCO needed the support of a major company to overcome all the financial and technology challenges of this Upper Zakum field.

ADNOC procceded to a call for tender between the international oil companies.

ExxonMobil won the bidding process to take shares in Upper Zakum, so that the working interests in the joint venture are currently:

 - ADNOC 60% is the operator

 - ExxonMobil 28%

 - JODCO 12%

Since then, ZADCO initiated to explore and develop the Umm al-Dalkh and Satah fields.

ZADCO Key figures

ZADCO figures are reported in ADNOC.

ADNOC as national oil company do not publish business figures

2011 production in Upper Zakum 500,000 b/d

ZADCO Projects and Business Highlights

In joining the ZADCO joint venture, ExxonMobil changed the development strategy.

As Upper Zakum is located half way between Abu Dhabi coast and Zirku Island where ADMA-OPCO has historically centralized all the oil and gas processing facilities, the development of the field was designed with approximately 100 steel platforms for drilling and production.

The expansion of Upper Zakum was also based on the same design.

But after assessing the costs of these steel frame platform over the long period of production and the environmental impact during operations and later for decommissioning, ExxonMobil introduced the concept of artificial islands.

In addition to the direct saving costs, the artifical islands provide Upper Zakum development with more flexibility to pre-process the oil and gas before exporting to the Zirku Island.

Now ZADCO is working on a 50% expansion of the Upper Zakum oil field to increase production from the actual 500,000 b/d to 750,000 b/d.

Because of the targeted volume of production, this project have been named Upper Zakum 750 or UZ750.

Requiring the construction of four artificial islands already in progress, ZADCO awarded the first engineering, procurement and construction (EPC-1) contract for the UZ 750 project to the french engineering company Technip in consortium with the local NPCC.

In parallel ZADCO is going to award the front engineering and design (FEED) contract for the Zirku Island expansion project where the oil and gas produced from Upper Zakum should be processed before export.

ZADCO and its partners, ADNOC, ExxonMobil and JODCO are to select the winner of the second package (EPC-2) of the Upper Zakum project in December 2012 for a completion in 2016.

 For more information and data about oil and gas and petrochemical projects go to Project Smart Explorer

together WE achieve

Based in Abu Dhabi within the United Arab Emirates (UAE), the Abu Dhabi National Company (ChemaWeYaat) was established recently in 2008 as the spearhead of the petrochemical industry in the UAE.

In order to create immediately a regional champion and develop synergies, the stakeholders transferred their respective petrochemical assets into their purposely formed ChemaWeYaat subsidiary.

As a result ChemaWeYaat is currently owned by:

 - Abu Dhabi National Oil Company (ADNOC) 20%

 - International Petroleum Investment Company (IPIC) 40%

 - Abu Dhabi Investment Council (ADIC) 40% 

As a result of the consolidation exercise in ChemaWEEyaat of their respective petrochemical assets, the owners transferred:

 - ADNOC Abu Dhabi Polymers Company (Borouge) located in Ruwais

 - ADNOC Borouge Marketing PTE in Singapore

 - Ruwais Fertilizers Industries (Fertil)

 - Overseas IPIC petrochemical activities. 

In Abu Dhabi, the main ChemaWeYaat petrochemical assets are located in:

 - Madeenat Al Gharbia

 - Al Taweelah

In setting up this regional champion, ADNOC and its partners aim at building ChemaWeYaat market leadership on reliability, quality, cutting-edge technology and competitive feedstock.

In order to develop synergies and share good practice without delay, ChemaWeYaat is active member of the Gulf Petrochemicals & Chemicals Association (GPCA).

ChemaWeYaat is also partnering with international chemical operators, engineering companies and licensors such as ADNOC, Borealis, Neste Jacobs, or WorleyParsons to develop the most advance expertise in the hydrocarbon transformation.

ChemaWEyaat Key Figures

As national company, ChemaWeYaat is not listed and does not publish figures

ChemaWEyaat Projects and Business Highlights

As a young company made of production units coming from different horizons, the priority for ChemaWeYaat is to implement an integrated business model as its closest competitors in the Gulf.

Benchmarking Ras Laffan Indusrial City in Qatar or Al-Jubail Industrial City in Saudi Arabia, Abu Dhabi wants to build the Chemical City for ChemaWeYaat.

In December 2010, the Abu Dhabi Government made the choice of the location and approved the master plan of the future petrochemical complex to be erected there.

This master plan is designed around the sites of Madeenat ChemaWeYaat Al Gharbia, as well as the other production site in Al Taweelah.

Located on the Western Region of Abu Dhabi, Al-Gharbia benefit from 70 square kilometers next to Ruwais industrial complex.

On the model of Ras Laffan, Al-Gharbia include an export terminal, facilities to take in seawater, and a cooling system for the industrial city.

We Refine Right

The Abu Dhabi Oil Refining Company, so called TAKREER, is the operational entity of the Abu Dhabi National Oil Company (ADNOC) in charge of the refining business.

Until 1999, the downstream activities were left as a branch within ADNOC, but with the development of this sector in Abu Dhabi and major projects to be launched in the years 2000s, ADNOC decided to separate it and establish a dedicated entity to handle it.

Under TAKREER umbrella, ADNOC transfered all the activities related to:

 - Crude oil refining

 - Condensate transformation

 - Supply of petroleum products

 - Sulfur treatment and granulation for export

TAKREER key assets rely on the Abu Dhabi Refinery and the Ruwais refinery.

As the first refinery in the United Arab Emirates (UAE), the Abu Dhabi Refinery started operations in 1976 with a capacity of 15,000 b/d and a capital expenditure of $45 million.

In 1982, ADNOC proceeded to a first expansion to 60,000 b/d capacity.

In 1990, the Umm al Nar salt and chlorine plant was merged with the Abu Dhabi Refinery to become the ADNOC Abu Dhabi Refinery and Chlorine Division.

In 1992, ADNOC decided a new expansion to 85,000 b/d and the upgrade of the process with desulfurization and sulfur handling units.

The Abu Dhabi Refinery holds 500,000 cubic meter storage capacities connected to a marine terminal for loading and unloading tankers.

The Ruwais refinery was commissioned few years later in 1982 in the western region of the Emirate, 240 kilometers west of Abu Dhabi City with a capacity of 120,000 b/d.

The purpose was to create the Ruwais Industrial complex around this refinery.

In 1985, ADNOC invested in a first expansion of 27,000 b/d, and in 1986 the refinery was merged with the Ruwais General Utilities Plant for the supply of power and water.

In 1991, ADNOC added the sulfur handling and granulation units to become one of the largest in the world.

In 2002, TAKREER commissioned two condensate processing trains of 140,000 b/d, also among the largest in the world.

Today, the Ruwais Refinery manages a farm of 91 tanks with a storage capacity of 3 million cubic meters linked to a marine terminal.

Now integrated in the refinery, the Ruwais utilities run a 650 MW gas-fired power plant and a 60,000 cubic meters per day desalination facility. 

Today, the Abu Dhabi Refinery and the Ruwais Refinery have a capacity of 460,000 b/d (23 million t/y) of crude oil and condensate.

TAKREER Key Figures

As part of a national oil and non-listed company, TAKREER does not publish figures.

TAKREER Projects and Business Highlights

Abu Dhabi is targeting to increase its crude oil production to meet its OPEC quotas 2018.

In the same time Abu Dhabi strategy is defined to reduce its reliance on this crude oil market in developing the downstream activities.

In parallel, Abu Dhabi is running short of natural gas meaning that the development of the downstream activities including the petrochemical sector will be mainly based on crude oil.

In this context, TAKREER will take a leading role in ADNOC strategy for growth, value creation and employement.

As a first step of its development, TAKREER awarded in June 2012 a $2.5 billion engineering, procurement and construction (EPC) contract to Samsung Engineering from South Korea for the construction of a carbon black delayed coker (CBDC) at the Ruwais Industrial Complex.

The purpose of this new plant is to produce higher value added products such as synthetic rubber and resins from the crude oil refining and heavy residual oil recycling.

This project will include 12 processing units and 23 infrastructure offsites and utilities.

Planned to start operations in 2015, this carbon black delayed coker project reflects the $10 billion refinery expansion planned in Ruwais Industrial City.

UAE Key Projects and Business Highlights

In the United Arab Emirates, 2012 is some kind of a transition year with the development of midstream projects in Fujairah and the bid preparation of large projects upstream and downstream.

With the completion of Habshan – Fujairah export pipeline, Abu Dhabi Company for Onshore Oil Operations (Adco) will be able to roughly half its total production directly on the Gulf of Oman to shunt the Strait of Hormuz.

This pipeline opens the way to a wave of capital expenditure in new projects to build giant storage capacities in Fujairah and a $3 billion refinery.

Abu Dhabi is planning to increase crude oil production from the actual 2.8 million b/d to 3.5 million b/d in 2018 and therefore needs to find to routes to secure its export.

To support this production growth, the Abu Dhabi National Oil Company (ADNOC) is planning major initiatives:

 -  Zakum Development Company (ZADCO) to spend $4.8 billion in the Upper Zakum project (UZ750)

 - Abu Dhabi Marine Operating Company (Adma-Opco) is working on the $2 billion Umm al Lulu and Sarb project

 - ADNOC selected OMV and Wintershall to appraise Shuwaihat sour gas and condensate field.

The UAE are running short of gas, as many countries in the Gulf and is prepared to import it through the Fujairah terminal if necessary.

In the meantime, ADNOC is investigating all ways to gathering flared gas and boost actual production such as in Bab field.

In cooperating with new comers such as Statoil, OMV and Wintershall, ADNOC is sending the signal to its actual partners BP, ExxonMobil, Partex, Shell, Total, that the selection of the international companies to be invited to bid on the renewal of the concessions in 2014 for the onshore fields and in 2018 for the offshore licenses will be decided in respect with the new technologies to be developed in the UAE.

In addition to maintain the gas production, ADNOC is targeting to improve its recovery rate from the actual fields in operations.

Through all these investments, the UAE and Abu Dhabi especially, will continue to invest in the coming years to secure their market share on the crude oil global market and to reduce their reliance on crude oil price in developing an integrated upstream-downstream business model to benefit from the whole hydrocarbon value chain.

ADNOC to boost upstream projects over downstream

With the Ruwais Carbon black and delayed coker (CBDC) facilities, Abu Dhabi Refining Company (Takreer) awarded the only giant project in the UAE during the first half 2012.

This downstream project came after a long period without major capital expenditure in the UAE since the Borealis and Abu Dhabi Polymers Company $3 billion Borouge expansion in 2010.

Takreer awarded:

 - In June 2012, the Engineering, procurement and construction (EPC) contract for the Ruwais refinery carbon black and delayed coker toSamsung Engineering from South Korea for $2.47 billion

>>> More information

ZADCO to award soon Upper Zakum 750 EPC-2 project

Abu Dhabi National Oil Company (ADNOC) and its partners, ExxonMobil and Japan Oil Development Company Ltd. (Jodco), are on the point to award the second engineering, procurement and construction contract (EPC-2) for ZADCO Upper Zakum 750 project.

ZADCO stands as the Zakum Development Company (ZADCO), a joint venture created in 1977 which currently is shared between:

>>> More information

Abu Dhabi prepares oil and gas concessions renewal

With the onshore concessions expiring in 2014 and the offshore ones coming up in2018, Abu Dhabi, in the UAE,  is to rewrite the terms of its producing fields and offer up fresh prospects.

The first oil concessions covering all the Abu Dhabi territory were awarded in 1939 to the Trucial Coast Development Company in which the majors BP, ExxonMobil, Shell and Total were part of.

>>> More information

Fujairah targets 13.3 m cubic meters oil storage in 2015

The Strait of Hormuz is channelizing35% of the global oil maritime traffic.

In a context of increasing tension with the neighboring Iran, Fujairah in the UAE is developing one of the biggest oil storage

>>> More information

$3 billion Fujairah refinery, IPIC calls for bid on FEED

International Petroleum Investment Company (IPIC) is moving ahead with the crude oil refinery project to be located at Fujairah, UAE.

The Fujairah refinery, should have a capacity of 10.0 million t/y or 200,000 b/d.

>>> More information

For more information and data about oil and gas and petrochemical projects go to Project Smart Explorer

BP to focus on crude oil Exploration & Production 

UK major BP PLc (BP) is planning to increase its capital expenditure per year from $19 billion in 2011 and $22 billion in 2012 to $24 billion in 2014 and $27 billion by 2020.

After Macondo blow and TNK-BP turbulences, BP is presenting its strategy to boost profitability and prepare ground for future growth again.

In this communication, BP‘s Chief Executive Officer, Robert Dudley, stated clearly that the period for downsizing BP to finance Macondo bill was over.

During this exercise, BP collected $38 billion from selling 50% of its upstream installations, 30% of its wells and 10% of its pipelines, but this shrinkage effort impacted the production by only 9% and the reserves by 10%.

These figures illustrate how much BP had diversified interests and the potential value of the remaining portfolio.

From this point, BP intends to concentrate its capital expenditures on its core assets; 80% should be allocated to upstream activities and especially to increase the production and the reserves of crude oil.

With this strategy, BP is planning to boost its cash flow by 50% from the $18.5 billion in 2011 to $30 billion in 2014 in targeting previous Macondo cash flow levels in the future.

To restore this cash flow volume, BP will focus on the highly selected oil fields mostly located in:

 - Angola

 - Azerbaijan

 - Middle East

 - North Sea

 - Russia through Rosneft

 - US Gulf of Mexico

BP to keep a leading role in Russia and Gulf of Mexico

In Angola, BP set a large program to expand Kizomba and Zinia and to explore pre-salt Benguela and Kwanza oil and gas fields.

In Azerbaijan, BP will invest $25 billion in the Shah Deniz phase 2 full field development and $12 billion in ACG with the local SOCAR 

In Middle East, BP is focusing on:

 - Iraq, where BP is negotiating with the Government new conditions to restore and develop the giant Rumaila oil field

 - Oman with Khazzan & Makarem  the unconventional gas Block 61 where BP is working on a $24 billion full field development program

 - UAE to prepare the renewal of the licenses in 2014 and 2018

In North Sea, BP is coming back with Clair Ridge phase 2, Quad 204 FPSO in Sheihallion and Greater Valhall expansion.

In Russia, after swapping its shares in TNK-BP with Rosneft, BP ends up with nearly 20% (19.75%) stake in Rosneft.

Considering the key role that BP played into TNK-BP to deliver outstanding performances in oil and gas recovery, BP expects to keep a similar role at larger scale in Rosneft in Russia in:

 - Arctic sea

 - Yamal Peninsula

 - Giant Bazhenov tight oil field

Rosneft will also give BP access to the $25 billion heavy crude oil Junin-6 project and the $1.5 billion Carabobo-2 development in Venezuela.

In addition to the production increase, Rosneft will provide BP with the opportunity to restore and pile up its crude oil reserves with the access to estimated 250 billion barrels new potential conventional and unconventional resources. 

BP is still the larger producer of oil in the Gulf of Mexico and intends to spend $24 billion capital expenditure between 2013 and 2017 to double the production from the actual 150,000 barrels of oil equivalent (boe) to 300,000 boe in 2016 with projects such as Mad dog phase 2, Thunder Horse expansion and new fields to be developed in Gila, Tiber and Kaskida.

Even if the Macondo incident is far from closed, BP does not see need for further divestment, but concentrates its capital expenditure where its has already established a solid market leadership in as a base for its future growth.

For more information and data about oil and gas and petrochemical projects go to Project Smart Explorer

CH2M Hill is working on Adnoc Bab sour gas pre-FEED

BP, ExxonMobil, Korean National Oil Company (KNOC), Shell and Total are the happy few pre-qualified international oil companies to submit offer for the $10 billion development of the Bab sour gas project in joint venture with Abu Dhabi National Oil Company (Adnoc) in the United Arab Emirates (UAE).

Postponed since 2007, the selection of Adnoc‘s partner in this project takes a special dimension as it comes a year ahead a much bigger game with the renewal of the actual allocated concessions for the onshore exploration and production of the Abu Dhabi oil and gas fields for the next 30 years.

The offshore concessions will come for renewal in the same way in 2018.

Bab is part of these sour gas fields in Abu Dhabi with Shah and Hail to contain a high percentage of hydrogen sulphide and carbon dioxide (CO2).

To be developed originally together with Shah, the escalation of the project costs and technical challenges convinced Adnoc to proceed step by step.

In 2008, Adnoc awarded the Shah gas development project to ConocoPhillips.

But in 2010, ConocoPhillips withdrew from the project and was replaced by Occidental Petroleum (Oxy) in 2011.

Shah gas development was already a challenging project with 27% CO2, but Bab sour gas comes now with 50%, about twice more.

In addition, Bab gas field is given to contain less valuable condensate in quantity and in quality that could help the profitability of the investment.

For this reason, Adnoc is looking for partners such as BP, ExxonMobil, Shell or Total with a proven expertise in handling such a complex project with costs well under control.

After UK and South Korea, France courts Abu Dhabi

The engineering company CH2M Hill is currently working on the pre-front end engineering and design (Pre-FEED).

At this Pre-FEED stage, Adnoc is working on two scenario of development, one based on 500 million cubic feet per day (cf/d), one to reach 1 billion cf/d of sour gas.

From the actual estimation, Bab sour gas project should also require $10 billion capital expenditure.

The selected company should form a joint venture with Adnoc where the national oil company should hold 60% stakes while leaving 40% to the winning bidder.

Anticipating on the rules to be enforced with the concessions renewals, the nominated Adnoc‘s partner will be the operator of the concession to develop the Bab sour gas project on the next 30 years supported by a production sharing agreement.

With the nearing deadline, the competition between the companies intensifies involving the Governments of the most motivated countries.

On November 5th 2012, UK Prime Minister David Cameron visited Abu Dhabi with several objectifs including to add BP on the list of the invited companies to participate to the concessions renewal and of course to be considered carefully for Bab Sour gas in respect with BP experience in challenging fields. 

Only two weeks later, on November 21st 2012, a delegation of the South Korean Government paid a visit to Abu Dhabi with the support of the national oil company KNOC to position itself on new fields to be developed and secure minimum crude oil supply.

Following this visit Adnoc announced to re-tender the $4 billion Upper Zakum EPC2 package that might have escaped to South Korean contractors at that time.

In January 15th 2013, French President François Hollande attended the World Future Energy Summit in Abu Dhabi to promote Total as the most reliable partner for the onshore concessions and provider of technology for Bab sour gas.

With 9.5% shares in Abu Dhabi Company for Onshore Operations (Adco) Total benefits from a long standing experience in Abu Dhabi with additional shares in Abu Dhabi Marine Operation Company (Adma-Opco) and Abu Dhabi Gas Industries (Gasco).

So far the development of the gas fields, especially sour gas, in the UAE was not a priority but with the economical growth calling for more gas-fired power plants, gas injection to boost oil production and the development of the petrochemical sector, gas has become a critical resource in Abu Dhabi giving Gasco a leading role in the UAE.

In this context, the competition between BP, ExxonMobil, KNOC, Shell and Total should intensify on Bab sour gas until Adnoc makes the decision on first half 2013.

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Adma-Opco to select contrators for key packages

On the last weeks Abu Dhabi Marine Operating Company (Adma-Opco) published the results of the commercial bids submitted by the engineering companies for the engineering, procurement and construction (EPC) contracts of the main packages related to the giant Umm al-Lulu and Satah Al-Razboot (Sarb) projects.

Acting as Abu Dhabi National Oil Company (ADNOC) operator for the offshore oil and gas fields in the United Arab Emirates (UAE), Adma-Opco is also partly owned by key stakeholders among the international oil companies (IOCs).

In Adma-Opco the interests are shared between:

 - ADNOC 60% is the operator

 - BP 14.66%

 - Total 13.33%

 - JODCO 12%

In respect with the sizes and complexity of the Umm al-Lulu and Sarb Full Field Development projects all the shareholders want to have their word in the final selection of the engineering companies to be awarded for these key packages.

UK Prime Minister David Cameron and France President François Hollande visited Abu Dhabi in a row earlier this year, and Japan, through a pool of banks just decided to allocate $3 billion loan to ADNOC

Made of the Japan Bank of International Cooperation (JBIC), Mitsubishi UFJ, Sumitomo Mitsui Banking Corp. and Mizuho Corporate Bank, this pool is willing to support ADNOC in boosting its upstream activities onshore and offshore in the perspective of the licenses renewal planned to start in 2014.

This context shows how much ADNOCs’ partners, BP, Total and JODCO,  are willing to proceed without any delay for the full field development of Umm al-Lulu and Sarb oil and gas fields as they should contribute to an incremental 200,000 barrels of oil equivalent (boe).

Adma-Opco awards Sarb EPC-3 to Petrofac 

As a first step, Petrofac, from UK, has been awarded the EPC contract for third package of Satah Al-Razboot (Sarb EPC-3) for $515 million.

This package covers the offshore part of the project with the connections to the central processing facility with:

 - 4 risers platforms with connecting bridges and facilities

 - 190 kilometers export pipeline to Zirku Island

 - 4 flares

This Sarb EPC-3 package will supply crude oil, raw natural gas and condensate to the fourth package of Satah Al-Razboot (Sarb EPC-4) for processing and export.

To be located onshore at the Zirku Island, the Sarb EPC-4 package is the master piece of the project as it includes all the oil and gas processing facilities to treat the oil and gas and liquids before being exported.

It also comprised the construction of the artificial islands Sarb1 and Sarb2 to support the drilling operations.

With a capacity of 100,000 boe/d, the Sarb EPC-4 package has been quoted by the engineering companies around $2 billion capital expenditure.

Actually Hyundai Engineering is given the lowest bidder at $1.88 billion.

The decision should come soon, closely followed up by the award of the second Satah Al-Razboot package (Sarb EPC-2) for the accommodation, office building and administrative facilities.

Satah Al-Razboot project counts also the package 1 (Sarb EPC-1) related to the site preparation and to be awarded around $200 million.

Regarding Umm al-Lulu the situation is also moving close to decision.

The local National Petroleum Construction Company (NPCC) submitted the lowest commercial offer for the first package (Umm al-Lulu EPC-1) at $800 million.

This Umm al Lulu EPC-1 package includes the upstream part of the project with six wellhead towers and the infield subsea pipeline.

Four engineering companies were in competition

 - McDermott from USA

 - National Petroleum Construction Company (NPCC)

 - Petrofac from UK

 - A partnership of Fluor and Leighton

The largest package is about the Umm al-Lulu EPC-2 which covers the oil and gas processing facilities and the living quarter.

With a capacity of 100,000 boe/d of oil and gas, the Umm al-lulu EPC-2 package was estimated to $650 million, but the commercial offers returned by the five teams in competition are much higher and with significant gap between the competitors.

Saipem is the lowest bidder with $1.5 billion, followed by Samsung Engineering with $1.8 billion, Technip just above $1.8 billion and Hyundai Heavy Industries close to $2 billion while Daewoo Shipbuilding Marine & Engineering (DSME) exceeds the $2 billion. 

The gap between Saipem and the following bidders rises questions that Adma-Opco and its patners BP, Total and JODCO are currently clarifying to make the final decision on Umm al-Lulu in parallel of the remaining Satah Al-Razboot (Sarb) packages. 

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OOC and Takamul to build world-scale storage terminal

On January 2013, Oman Oil Company (OOC) and Takamul Investment Company (Takamul), both companies from the Sultanate of Oman, established a joint venture to build one of the world largest oil storage terminal at Raz Markaz in Oman.

Called Oman Tank Terminal Company LLC (OTTCO), this new company will share the interests between the stakeholders such as:

 - OOC 90% the operator

 - Takamul 10%

The purpose of this joint venture is to build, own and operate a giant oil tanks farm with a capacity of 200 million barrels of crude oil.

This oil terminal should be located in Raz Markaz, 70 kilometers south of Duqm, along the coast of the Al Wusta Governorate in Oman.

OOC and Takamul selected Raz Markaz as to be the closest harbour from Duqm to offer a natural access by the Indian Ocean with 32 meters of water depth.

With this natural water channel in the seabed, Raz Markaz will be able to handle crude oil super tankers.

Raz Markaz oil storage terminal to become regional hub

Positioned in the southern part of the Sultanate of Oman with directly on the Indian Ocean, The OOC and Takamul oil storage terminal is designed to take a strategic position in the region as to shunt the Strait of Hormuz.

In addition to the role of import terminal for the Duqm refinery, the Raz Markaz oil storage terminal is intended to become a regional hub in the Middle East at the same scale as Singapore in Asia or Rotterdam in Europe.

Currently the Strait of Hormuz concentrates 42% of the global crude oil trade, but with the development of the exploration-production in Iraq, Kuwait, Saudi Arabia and Abu Dhabi in the United Arab Emirates, this ratio is expected to climb up to 50% in the next 20 years.

In addition to store oil, the Raz Markaz terminal will have also the facilities to blend crudes and separate them through different sizes of tanks with capacities per unit ranking from 755,000 barrels to 1.75 million barrels.

OOC and Takamul Raz Markaz project will become the second oil storage terminal in Oman after Mina Al-Fahal along the north coast in the Gulf of Oman.

OOC adds pipelines in Duqm and Raz Markaz projects

To balance the supply and develop its import and export capabilities, the Oman Ministry of Oil and Gas signed a Memorandum of Understanding with the OOC and Takamul OTTCO joint venture to build a crude oil pipeline between their Raz Markaz oil terminal and the Main Oil Line pipeline in the north of the country.

onnection between the pipeline coming from Raz Markaz and the Main Oil pipeline should take place in Al-nahda.

This crude oil pipeline between Raz Markaz and Al-nahda should be approximately 440 kilometers long.

It should be a separate pipeline from the line to supply the Duqm Refinery and petrochemical complex.

To power the Duqm integrated refinery-petrochemical complex, OOC is also planning a 230 kilometers natural gas pipeline between the Saih Nihayda gas field and a power generation facility to be installed in Duqm.

This pipeline should have a capacity of 25 million cf/d and should run into operation in 2015.

For the export of petrochemical products, OOC is planning with its partner International Petroleum Investment Company (IPIC) in the Duqm Refinery and Petrochemical project to add a jetty with storage capacity of 150,000 tonnes of liquids. 

Because of the size of the Raz Markaz oil storage terminal project, OOC and Takamul are planning to build it in phases with the phase one due to start in 2017.

For more information and data about oil and gas and petrochemical projects go to Project Smart Explorer

Technip to complete FEED work for onshore NEB 3

The national Abu Dhabi Company for Onshore Operations (ADCO) is making significant progress in the North East Bab field with the contracts to be awarded soon for the development of the third phase called NEB 3.

ADCO is the joint venture between Abu Dhabi National Oil Company (ADNOC) and international partners, BP, ExxonMobil, Shell, Total and Partex to develop onshore fields in the Emirate.

In the ADCO joint venture, ADNOC and its partners share the working interests as following:

 - ADNOC 60% is the operator

 - BP 9.5%

 - ExxonMobil 9.5%

 - Shell 9.5%

 - Total 9.5%

 - Partex 2%

The North East Bab (NEB) field is located 31 kilometers south west of Abu Dhabi City in the United Arab Emirates and covers 1,400 square kilometers.

As ADCO‘s largest asset, NEB is comprising four fields, Al-Dhabbiya, Rumaitha and Shanayel already in production and Jumaylah still untapped.

NEB is lying across Abu Dhabi coast line so that Rumaitha and Shamayel are onshore while Al-Dhabbiya is located 30 kilometers north mostly offshore in shallow water.

Because of its coastal position, NEB is environmentally sensitive with mangroves, coral reef, salt marshes and low level islands hosting unique and protected wildlife species.

In addition this area counts among the rare archaeological sites of the Emirate. 

For these reasons Abu Dhabi is paying the greatest attention that any oil and gas field development in NEB is designed and executed in entire respect with these environmental constraints giving the advantage to engineering companies familiar with the place and able to provide solutions to reduce the environmental foot print of the industrial activities during the projects phases and later when running into operations.

The third phase of North East Bad (NEB 3) development belongs to ADCO strategic plan to increase its production of crude oil from the current 1.4 million barrels per day (b/d) to 1.8 million b/d in 2018.

With Zakum Development Company (ZADCO) due to reach 1.7 million b/d by then, Abu Dhabi is targeting 3.5 million b/d in 2018.

This target is part of the quotas given by the OPEC organization to each producing country in order to ensure to continue to represent 40% of the global production by 2018.

This stake of 40% is the percentage that OPEC is continuously targeting  to maintain its influence on the crude oil global market.

In this perspective ADCO is planning to spend $1 billion capital expenditure in the NEB 3 project to add 110,000 b/d of crude oil production.

ADCO awarded PMC contract to Mott MacDonald

This North East Bab third phase project includes two packages:

 - Onshore, the development of the Rumaitha and Shamayel fields

 - Offshore, the development of the Al-Dabbiya

In the previous phases of NEB development Technip in joint venture with the  local National Petroleum Construction Company (NPCC) performed the engineering, procurement and construction (EPC) contracts while CH2M HILL was providing project management consultancy.

Currently Technip is working on the front end engineering and design (FEED) of the onshore part of the NEB 3 project.

ADCO is expecting Technip to complete this FEED by the end of April in order to organize the call for tender of the EPC contract for this onshore part on the second half of 2013.

Because of its complexity, the offshore Al-Dabbiya part of the NEB 3 project is phased up in a different schedule.

ADCO is currently evaluating the offers for the FEED work of the offshore package of NEB 3 in order to make a decision in April 2013 and to award the EPC contract by 2014.

In 2012, ADCO selected the UK-based Mott MacDonald to provide the project management consultancy services of the NEB 3 project, onshore and offshore.

According to the terms of its contract Mott MacDonald will support ADNOC and its partners BP, ExxonMobil, Shell, Total and Partex, for the FEED and the EPC work of ADCO North East Bab third phase (NEB 3) project.

For more information and data about oil and gas and petrochemical projects go to Project Smart Explorer