Abu Dhabi stalls Ruwais expansion plans

05 October 2009

Gasco re-evaluates feasibility of $300m sulphur terminal project

Abu Dhabi Gas Industries Company (Gasco) has put plans for a $300m expansion of its sulphur terminal at Ruwais on hold because of doubts over the feasibility of the project.

Gasco’s parent company, Abu Dhabi National Oil Company (Adnoc), is already building a second sulphur-export terminal at Ruwais as part of its $10bn project to develop sour, or sulphur-rich, gas reserves at the Shah field in the southwest of the emirate.

Adnoc’s $1bn facility at Ruwais will be one of the largest in the world. Gasco and Adnoc are discussing whether they need to expand Gasco’s existing terminal.

International contractors had expected to submit final bids for the $300m engineering, procurement and construction (EPC) Gasco work on 31 September.

However, on 27 September Gasco sent them a letter putting the project on hold.

“The project won’t go ahead for now because they need to do more feasibility studies,” says a source at one of the companies which had hoped to bid on the deal.

Abu Dhabi’s oil and gas fields contain large amounts of sulphur, and Gasco has become one of the world’s leading producers and exporters of the chemical. Global demand has fallen significantly over the past year, however, casting doubts over the feasibility of any expansion to the sulphur-handling terminal at Ruwais.

Contractors have expressed concerns about the complexity of building a 136-kilometre pipeline linking Shah with processing facilities at Habshan. The US’ Fluor is working on new designs for the pipeline (MEED 18:6:09).

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