Adnoc and Occidental sign Shah partnership agreement

04 April 2011

Production at the $10bn natural gas field development will begin in 2014

Abu Dhabi National Oil Company (Adnoc) and US Occidental Petroleum have signed a partnership agreement to develop the Shah natural gas field, a $10bn deal that had been agreed to in principle in January, UAE state news agency WAM has reported.

Production at the suphur-rich field, which is expected to eventually reach 1 billion cubic feet a day (cf/d) will commence in 2014, said the news agency.

Under the January agreement, Occidental will have a 40 per cent stake in the project.

The signature of Occidental for the scheme fills a major gap in skills and technology left by the departure of ConocoPhillips, another US oil major, in April 2010. Occidental beat proposals from the UK/Dutch Shell Group, as well as from US rival ExxonMobil, to clinch the deal.

After separating the sulphur from the natural gas, the scheme is expected to produce 650 million cf/d of dry gas. The sulphur by-product will be transported to granulation and distribution facilities at the Shah and Habshan fields and then on to Ruwais on the Gulf coast.

The Shah field is located about 180 kilometres southwest of Abu Dhabi.

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