Petrofac loses $1.65B gas contract in Abu Dhabi

Oilfield service company Petrofac said Thursday it has lost the $1.65 billion recently awarded contracts for Adnoc’s Dalma Gas Development Project.

The contracts were awarded in February to a Petrofac Emirates joint venture and expected to be completed in 2022. Petrofac’s portion of the contract was valued at $1.5 billion.

“Petrofac is committed to working with Adnoc over the coming weeks to explore alternative options to deliver this project in a way that supports their strategic objectives within the current challenging environment,” the oil service company said.

The offshore gas project is a key part of the Ghasha ultra-sour gas concession, and ultimately plays a role in helping Abu Dhabi to achieve gas self-sufficiency. Dalma is planned to produce 340 million cubic feet per day of natural gas, while the Ghasha mega-project is slated to produce over 1.5 billion cubic feet per day of gas.

An Adnoc spokesperson said the termination was a decision taken together with its partners. “We continue to responsibly progress our projects while optimizing our costs, driving performance, efficiency and value across our portfolio.”

Petrofac also said it continues tendering for other major contracts in Abu Dhabi, but it anticipates delays on the awards.

Source: Kallanish Energy