Giant gas complex key to Abu Dhabi petroleum strategy

Artist's rendering [46873 bytes] shows these elements of Abu Dhabi's giant Habshan gas complex: (1) and (2) each 350 MMscfd gas treating trains, (3) 600 MMscfd gas treating train, (4) three 600 metric ton/day sulfur recovery units, (5) utilities area, (6) main control room, and (7) Thamama F reservoir condensate separation/stabilization unit.

Abu Dhabi National Oil Co.'s (Adnoc) $1.35 billion Bab/Habshan gas gathering and injection complex that recently started up is a key element in a massive investment program Abu Dhabi is undertaking to bolster its oil and gas production and expand its downstream presence.

The emirate plans to hike production capacity of crude oil by 50% and condensate by 300% by 2003 and sharply expand its refining and petrochemical capacity. Overall spending upstream and downstream is earmarked at $10 billion the next 5 years.

Habshan complex

Habshan, touted as the world's largest onshore natural gas complex, is 150 km south of Abu Dhabi City near the Persian Gulf coast. New facilities there integrate into the complex production from giant Bab oil and gas field's Cretaceous Thamama F, B and C reservoirs, jumping the site's gas processing capacity by more than 960 MMcfd to about 1.7 bcfd.

At the same time condensate production has jumped to 131,000 b/d from 5,000 b/d, and recovery has begun at an average 5,000 metric tons/day of natural gas liquids and 1,800 tons/day of sulfur. Condensate is transported via pipeline and LPG and sulfur via truck to the Ruwais refinery on the coast for export.

The sale of condensate alone-exempt from Organization of Petroleum Exporting Countries' quotas-is expected to pay for the entire project the next 2 years even if crude oil prices were to drop as low as $13/bbl. Total revenues from the plant are expected to generate $600 million/year.

A combine of Technip 60% and Bechtel 40% completed the turnkey contract for Adnoc.

Under first phase Bab development, 40% of the gas produced is being reinjected into the oil reservoir for pressure maintenance. In a second stage, the gas will be recovered to generate electricity and be used as feedstock for Abu Dhabi's first venture into petrochemicals, to be based in Ruwais.

Phase 2 also calls for three or four gas processing trains to handle another 1 bcfd of gas as well as 1,800 tons/day of NGL, 30,000 b/d of condensate, and 850 tons/day of sulfur.

Downstream projects

Adnoc has not yet decided on a partner for a $800-900 million, 300,000-450,000 ton/year ethane cracker to produce high and low density polyethylene at Ruwais.

Two companies will be set up to complete the project, including foreign partners to be chosen among BP Chemicals, NOVA Co., Phillips Petroleum Co., Borealis AS, and Mitsui & Co.

The plant is to be on stream 48 months after the project is approved, with the Far East as the targeted market.

Adnoc is planning a second, $1 billion petrochemical complex at Ruwais to produce 800,000 tons/year of paraxylene and 100,000 tons/year of benzene. A feasibility study has been carried out with Japan Industrial Development Organization, and talks are proceeding with Sumitomo Corp. about possible participation.

The PE and benzene projects are linked to expansion of the Ruwais refinery. That calls for doubling the plant's crude processing capacity from 135,000 b/d and upgrading it to increase production of naphtha, LPG, kerosine, jet fuel, and gas oil. Included in the project is a fractionation plant with two 140,000 b/d trains to process Habshan condensate. In addition, the refinery's catalytic reformer will be expanded with the incorporation of a continuous catalyst regenerator.

The whole refinery project, including a sulfur unit, will cost about $1.8 billion. Adnoc let an initial $40 million front-end engineering and design contract last October to Fluor Daniel. Work on that contract is to be completed by December.

The total project is expected to take 3 years to complete and could be divided into several contracts. Bids are to be tendered in August.