Expanding oil and gas production while getting significantly greener

Falling oil prices will no doubt have an impact on Abu Dhabi’s energy sector, but international experts agree that the emirate’s relatively lower oil-production costs and high cash balance put it in a much better position to come to grips with lower per-barrel prices than other oil-producing countries.

ADNOC is the producer of around 94 percent of the UAE’s crude oil, and it announced in 2008 that it would boost its natural gas output by about a third to as much as 8 million cubic feet a day in the next five years. This increase will come from the Shah sour gas field, developed with ConocoPhilips, and the Integrated Gas Development project, both set to come on stream around 2012-2013.

Oil-sector leaders seem confident targets will be met, although perhaps not as quickly as had been planned. The Abu Dhabi Energy Company (Taqa), a semi-sovereign wealth fund 75 percent owned by the government, announced on January 28 that it had slowed down its push to boost assets to USD 60 billion but that the level remains its target despite the adverse impact of lower oil prices. CEO Peter Barker-Homek said, “We are still targeting a company with an asset portfolio of USD 60 billion but we are actually moderating when this will be achieved. We had spoken about 2012, but now it will probably be in 10 years.”

One result of the global downturn is lowered costs of oil projects. On January 26, ADNOC announced that it had saved about 20 percent on costs of projects worth USD 3.5 billion that were awarded in early January, as a result of the financial crisis. Abdul-Munim Al Kindi, general manager of ADNOC’s onshore unit ADCO, said that the cost of projects awarded to foreign companies for work on three fields “was 20 percent lower than the total cost possible six months ago.”

ADNOC going green

ADNOC is supporting Abu Dhabi’s “green” energy drive. It recently signed an agreement with Masdar, the emirate’s new-energy-technologies initiative, to develop a series of projects to reduce carbon emissions from Abu Dhabi’s oil and gas facilities. Yousef Omair Bin Yousef, ADNOC’s CEO, explains, “Towards achieving our goal to make ADNOC a world-class environmental company, our focus on health, safety and environment has been growing. Key achievements include dramatic reduction of gas flaring.”

At the recent World Future Energy Summit held in Abu Dhabi, Khaled Awad, a Masdar director, commented, “Abu Dhabi is an oil-exporting country, and we want to become an energy-exporting country, and to do that we need to excel at the newer forms of energy.” Dr. Sultan Al Jaber, CEO of Masdar, commented that the emirate plans to generate 7 percent of its energy needs from renewable sources by 2020 and to create a renewable energy market worth USD 6 billion to 8 billion in Abu Dhabi.

Typically thinking ahead, Abu Dhabi is forging a role as a leader in research and development of alternative energy technologies while continuing to develop its downstream and upstream oil and gas sector.

Granite Construction Company

“Granite is known for its unprecedented track record concerning critical oil & gas projects.”

Granite Construction Company, established in 1973, is a leader in the local construction sector. Ramzik Tatevossian, Managing Director, explains, “Granite specializes in construction projects in the oil, gas, power, water, industrial and commercial sectors, and is well known for its high standards, technical expertise, strategic planning skills, and a focus on satisfying clients.” Granite employs over 2,500 people and has operations in Asab, Buhasa, Ruwais, Das Island and Zirku Island in addition to its headquarters in Abu Dhabi City.

Granite has adopted the latest technologies to ensure the best quality products and services, including a state-of-the-art Virtual Private Network that links all the company’s locations, operations and services. Granite’s quality management system has been accredited with ISO 9001-2000, and the company has been a certified Institute of Quality Assurance member since 1999. Granite emphasizes health, safety and the environment and is certified OHSAS 18001 and ISO 14001. Granite’s well known design and engineering division employs the latest analysis and drafting software as well as all necessary large-format printing and plotting devices.

The company’s specialities include site preparation, infrastructure projects, industrial buildings, accommodation blocks and related complexes, control buildings, substations, concrete rehabilitation projects, pipeline projects, external plumbing and drainage, water and sewage treatment facilities, desalinization plants, and related activities. Granite’s client list is a who’s who of local companies, including all the local leaders in the oil and gas, power and infrastructure sectors.

As Tatevossian points out, “Granite is known for its unprecedented track record concerning critical projects such as plant shutdowns and fast track projects, as well as for its award-winning health, safety and environmental programs.” Granite’s mission is to continue to focus on Quality and HSE (Health, Safety & Environment) and to ensure that clients are satisfied with every aspect of the company’s operations. Granite welcomes partnerships with foreign companies and investors and has positioned itself as the ideal local partner for American companies operating in Abu Dhabi.