Dana Gas has signed an agreement with the governments of Sharjah and Ajman to develop a shared gas field 40 kilometres off the UAE’s Gulf coastline.

The Sharjah-based company plans to develop the field by drilling horizontal wells and installing an offshore platform to process the gas via a new 25km pipeline. Dana Gas is aiming to commence production at the field in the first half of 2014.

The deal covers the shared management of the field, gas sales and purchase agreements and a joint operating agreement with the two emirates.

Dana Gas holds the Sharjah Western Offshore Concession covering a total area of 1,000 square km, which includes the Zora gas field.

According to the company’s website, Dana Gas had planned to develop the Zora field with a wellhead facility connected to an onshore processing plant via a pipeline. The project was expected to start up in early 2012 at a rate of 60 million cubic feet a day (cf/d) of gas.

Indonesian engineering group Tripatra completed the front-end engineering and design (feed) work on the project earlier this year, while Australia’s WorleyParsons is the scheme’s project management consultant (PMC).

The scheme is a significant development for the northern emirates of the UAE, which are eclipsed by their larger neighbour Abu Dhabi in terms of oil and gas production.

Sharjah’s Crescent Petroleum has the capacity to produce 150 million cf/d of gas from the offshore Mubarak field, but output is significantly below this. At the same time, the UK’s Petrofac operates a gas plant at the onshore Sajaa field with a processing capacity of 600 million cf/d, but as of 2009 it was only receiving an estimated 120 million cf/d.

The Dana Gas project will represent the first gas revenues for Ajman, which along with fellow northern emirates Fujairah, Ras al-Khaimah and Umm al-Quwain has no upstream oil and gas production.