Oil majors BP and Royal Dutch Shell have submitted bids for a sour gas project in the UAE that could be have a price tag as high as $10 billion.
The UAE holds the world’s fifth largest gas reserves, and needs to develop them to meet soaring domestic demand. It and neighbouring Gulf countries are facing rising energy needs as their populations grow and economies expand, fuelled by record oil revenues.
“We have made a submission,” a BP company spokesman said yesterday. Bids for the project were due in to state-run Abu Dhabi National Oil Company (Adnoc). A Shell company source also confirmed that it made a bid.
Industry sources said that France’s Total and US Occidental Petroleum Corp had also submitted bids.
Adnoc invited bids from several other companies including BG Group, Chevron, ConocoPhillips, ExxonMobil and Japan Oil Development Co.
The contract will be awarded in the fourth quarter this year, an official from Adnoc’s gas unit Gasco said in March.
The project will boost sour gas output by around a billion cubic feet per day. It requires the installation of four sulphur processing units to treat the gas.
Gasco plans to invest around $11 billion on gas projects over the next five years to boost output.
Abu Dhabi has said it plans to increase its natural gas output by 36 per cent to 7.2 billion cubic feet per day by 2009.