Adnoc is moving forward with plans for a new liquefied natural gas (LNG) export facility in Fujairah, strategically located on the UAE's east coast to bypass the Strait of Hormuz. The project is currently in the design competition phase, with bids expected within days. Adnoc intends to select two to three contractors for this phase, who will then be eligible to participate in the subsequent engineering, procurement, and construction (EPC) phase. This new facility, once approved and built, will offer an alternative export route, avoiding potential disruptions in the Strait of Hormuz.
The Fujairah facility, alongside the Ruwais LNG project, is set to significantly boost the UAE's LNG export capabilities. The Ruwais facility, with a final investment decision made in June 2024 and an EPC contract valued over $5.5 billion, will have a production capacity of 9.6 million tonnes per annum (mtpa). Equity partners in Ruwais include Mitsui & Co, Shell, BP, and TotalEnergies, each holding a 10% stake, while Adnoc expects to transfer its 60% share to Adnoc Gas for an estimated $5 billion in the second half of 2028. This expansion aims to more than double Adnoc's existing UAE LNG capacity to around 15 mtpa, up from the current 6 mtpa from the Das Island terminal.
Adnoc Gas has already secured long-term sales and purchase agreements for over 8 mtpa of the Ruwais project's output, allocating 80% to long-term contracts and marketing the remainder on the spot market. Construction for the Ruwais project is progressing ahead of schedule, though the expected start of commercial operations remains unchanged. The company also completed an upgrade program for its aging Das Island facility last year, including expanding loading jetties and planning a major refurbishment of trains one and two to ensure operational reliability.
The new Fujairah project is estimated to cost upwards of $5 billion. It will include liquefaction facilities, a new gas pipeline connecting Abu Dhabi's onshore Habshan field to the Fujairah terminal, and a new gas compressor at Habshan. The facility, likely named Fujairah LNG, will consist of two 4.8 mtpa trains. Adnoc Gas anticipates an increase in global LNG demand, driven by new countries entering the import market, which these expansion projects are designed to meet. The company's CFO, Peter Van Driel, noted this trend, highlighting the strategic importance of expanding export capacity.
