Italy’s Saipem has won an optimisation front-end engineering and design contract from Abu Dhabi National Oil Company (Adnoc) targeting incremental development of the Umm Shaif gas cap project.

Multiple people with direct knowledge of the development told Upstream the Italian contractor was recently awarded the prized engineering contract, described internally as a "FEED update for design optimisation".

The workscope is likely to be carried out over the next six to eight months, one person said.

Saipem was one of the key bidders involved in a previous FEED contest launched in 2019, combining the project's separate engineering stage with the engineering, procurement and construction package in an innovative tender format.

However, the the coronavirus outbreak and low commodity prices have since led to the Umm Shaif gas cap development being delayed.

Strategic priority

Upstream understands that Adnoc is now keen to pursue the strategic gas cap project and Saipem has taken on an optimisation remit aimed at lowering development costs and reworking key facilities.

Bidders in the earlier version of the tender included a consortium of Abu Dhabi-based National Petroleum Construction Company with TechnipFMC, US giant McDermott bidding on its own, and Italy’s Saipem.

UK-listed Petrofac was also earlier involved in the bid process along with Saipem but later dropped out as it was barred from participating in Adnoc tenders.

Workscope details

The offshore workscope initially included a gas processing platform, separation platform, riser platform, wellhead platforms, flare and water disposal towers along with subsea pipelines and cables, project watchers said.

The development also includes brownfield modifications on Abu Dhabi's Das Island, which hosts major processing facilities.

UK-based Genesis Oil & Gas — a subsidiary of Technip Energies — earlier performed conceptual study work and defined the FEED workscope.

Umm Shaif gas cap is expected to add 500 million cubic feet per day of gas to Abu Dhabi’s domestic production.

Adnoc declined to comment to Upstream on the Umm Shaif gas cap engineering award.

Gas push in the Emirate

Adnoc is continuing to press ahead with key oilfield developments in line with its 2030 strategy, but the company is also expected to spend billions of dollars to ramp up the Emirate's gas output capacity.

Adnoc is expected to spend close to $20 billion on the Ghasha sour gas concession alone, which will include development of the Hail & Ghasha and Dalma offshore fields.

International engineering giant Technip Energies recently won a revised FEED contract from Adnoc for work on the Hail & Ghasha offshore sour gas development, which is likely to add up to 1.5 billion cubic feet per day of gas by the middle of the decade.

As well as sour gas projects, Adnoc is expanding into unconventionals, tapping into gas cap reservoirs and unlocking new resources as it aims for gas self-sufficiency and, in time, to emerge as a key gas exporter.

A company spokesperson recently told Upstream that gas-based developments are a key part of the company’s long-term goals.

“At the heart of this goal is the expansion of our producing assets like Shah and the development of new ones, like the unique Umm Shaif gas cap and the Hail, Ghasha and Dalma project[s],” he had said.

Combined, the ongoing gas developments in Abu Dhabi are expected to add more than 3 Bcfd of gas production in the coming years.