Abu Dhabi’s multibillion-dollar Hail and Ghasha sour gas development project has cancelled following the termination of two key contracts for onshore and offshore work by the Abu Dhabi National Oil Company (ADNOC), the city’s energy major, according to a report by Upstream.
Hail and Ghasha is one of the largest oil and gas projects in the UAE in recent years, and is a crucial part of Abu Dhabi’s plans to expand its gas production capacity by the end of this decade.
The project is expected to provide feedstock for Abu Dhabi’s gas export plans, in addition to its ambitions to become a major hydrogen producer, and will add to 1.5 billion cubic feet per day of gas at its peak, the report said.
Sources familiar with the matter have said that ADNOC has informed key stakeholders that the project’s pre-construction services agreements (PCSAs), recently awarded to two international consortia, now stand terminated.
“The PCSAs have been cancelled and ADNOC is now expected to shortly embark on a fresh tendering process comprising multiple engineering, procurement, construction and installation packages,” a soruce said.
The termination of the deals has come as a significant setback for the project, which is already delayed by several years.
“This [cancellation] could potentially lead to further delays, as fresh bids will be invited in the coming months,” the report said, citing another source.
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