Abu Dhabi National Oil Co. is advancing plans for a new liquefied natural gas export project, making it the latest company looking to capture a share of the growing market later this decade.
Adnoc is preparing to reach a final investment decision on its Ruwais LNG project in the first half of 2024, according to people with knowledge of the plan. The company had previously said it wanted to begin exports from 2028.
The UAE and the Gulf nation of Qatar are betting tens of billions of dollars that cleaner-burning natural gas will be needed as a bridge fuel to transition to renewables, while others say the outlook isn’t so rosy. The International Energy Agency expects gas demand to peak in all forecast scenarios by 2030.
While Adnoc has sold some supply from the Ruwais project under long-term deals, most remains uncontracted, according to BloombergNEF data. Lining-up customers is usually a crucial requirement for banks to provide financing. Instead, Adnoc aims to use its own funds to back the plan, the people said, similarly to how Qatar is supporting its expansion.
Adnoc declined to comment.
The plan coincides with a US pause on approving new permits for LNG exports, which threatens to delay proposed projects in the late-2020s. That is providing a potential opening for building gas infrastructure elsewhere.
The Ruwais unit will more than double Adnoc’s LNG export capacity as part of a wider effort by the state-run company to expand its trading business. So far, Adnoc has signed sales pacts with China’s ENN Natural Gas and GAIL India Ltd for supply from the new plant.
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