DEL signs up for Omani gas

19 July 2002

Abu Dhabi-based Dolphin Energy (DEL)signed on 14 July a memorandum of understanding (MoU) with Oman Oil Company (OOC)to purchase an estimated 120 million cubic feet a day (cf/d) of gas. Under the terms of the outline agreement, the Omani gas will be delivered over a 42-60-month period, with first deliveries scheduled to begin in the second half of 2003. It will be used as feedstock for the Fujairah power and desalination complex, which is due to be completed in the third quarter of 2003 (MEED 21:6:02).

The MoU sets out the general conditions for the gas sales agreement. It provides for OOC to deliver the gas by a new pipeline, which will run to the UAE/Omani border from the Fahud-Sohar pipeline. For its part, DEL will build a short pipeline from the border to connect with the Al-Ain-Fujairah gas line, which is being built by India's Dodsalunder a $55 million contract awarded in mid June.

The Omani gas will be replaced in 2006/07 by Qatari gas, which will be delivered under the Dolphin project.

The establishment of a gas pipeline link between the UAE and Oman represents a further step in the creation of GCC gas grid. It also raises the possibility of Oman importing gas at a future date.

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