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Adgas revives contract for expansion at Das Island

Abu Dhabi company issues expressions of interest to international contractors for second phase of Integrated Gas Development

Abu Dhabi Gas Liquefaction Company (Adgas) has revived a key onshore project involving a gas treatment plant required for the second expansion phase of its Integrated Gas Development (IGD) project on Das Island, with the contract thought to be worth more than $1 billion.

Sources close to the tender process said Adgas has floated expressions of interest for the further expansion of the IGD project, aiming to pre-qualify leading engineering, procurement and construction players.

More than a dozen leading international companies are believed to have been issued with the EoI documents by Adgas and responses are likely to be submitted later this month, sources added.

“The EoI is due for submission in two weeks’ time and we are hoping that the tender process will be launched as early as next month,” one source said.

Those thought to be among the invited players include UK-listed Petrofac, French major TechnipFMC, KBR of the US, Italy’s Saipem and Tecnimont, Abu Dhabi’s National Petroleum Construction Company, Spanish player Tecnicas Reunidas, Japan’s JGC and Chiyoda, Korean players GS E&C, Hyundai Heavy Industries and Hyundai E&C.

Other players could also be in the fray, but their names could not be confirmed by Upstream.

Adgas is owned by state-owned giant Abu Dhabi National Oil Company (Adnoc), which holds a 70% stake in the company alongside Japan’s Mitsui on 15%, UK supermajor BP with 10% and French giant Total holding 5%.

The scope of work for the second expansion phase of IGD includes two new booster compression trains, each with capacity of 60 million cubic feet per day, as well as three feed gas compression and dehydration trains, each having a capacity of 123 MMcfd.

Also, two amine-based fuel gas treatment packages of 70 MMcfd capacity each are part of the IGD tender and the scope includes two motor driven off-gas compressors and other related surface facilities, sources said.

During the second expansion phase of IGD, Adnoc plans to transfer 245 MMcfd of additional low pressure gas to Hasban from Das island, via the existing pipeline network.

The onshore EPC contract being offered by Adgas is thought to be similar to the fourth package of the IGD project, which was tendered two years ago but was ultimately cancelled.

“They (Adgas) are describing it as the second expansion phase of IGD, but the scope is similar to the IGD-4 package offered two years ago,” one source suggested.

Italy’s Tecnimont was believed to be the lowest bidder for the IGD-4 package, offering a price close to $1.4 billion, sources said.

Commercial bids were submitted by four players in 2015 — Tecnimont, Petrofac, Saipem and Tecnicas Reunidas.

However, state oil company Adnoc decided last year to cancel the tender process for IGD-4 as it wanted to further reduce costs.

Sources have indicated that the workscope of the new IGD tender has been optimised by Adnoc and the offshore component has been taken out, which is likely to result in substantial savings for the operator. 

“Adgas has reduced the scope of work and the work now offered is 100% onshore,” one source said.

Adnoc launched the IGD expansion project in 2015 to meet increasing domestic gas demand.

The project aims to further boost offshore gas processing capacity in the emirate by an additional 400 MMcfd, according to WAM, the United Arab Emirates’ official news agency.

The state-owned giant awarded three packages for the IGD expansion project in 2015.

A consortium of Tecnimont and Greece-based Archirodon won a $491 million EPC contract in February 2015 for gas processing facilities, while a second package comprising 117 kilometres of offshore pipelines, was awarded to Abu Dhabi-based National Petroleum Construction Company.

The third EPC package worth $685 million, involving onshore pipelines and other facilities, was won by Tecnicas Reunidas in 2015.