"ADNOC" and "TAQA" announce a strategic project to supply electricity to "ADNOC's marine operations" and reduce its carbon emissions

The Abu Dhabi National Oil Company "ADNOC" and the Abu Dhabi National Energy Company "TAQA" announced today the development of a strategic project at a cost of 13.22 billion dirhams (3.6 billion dollars) aimed at reducing carbon emissions from ADNOC's offshore field operations.

The innovative project, which is the first of its kind in the Middle East and North Africa region, will witness the development and operation of a high-voltage direct current transmission system under the sea to supply ADNOC's offshore production operations with more efficient and environmentally friendly energy by linking it to Abu Dhabi's onshore electricity grid. "energy".

 This project will be financed by a company created specifically for this purpose and jointly owned by ADNOC and TAQA with a 30% stake each, and a consortium that includes the Korean Electric Power Company (KEPCO), Japan's Kyushu Electric Power Company, and the Electricity Company French "EDF" with a 40% stake.

The consortium will develop and operate the advanced electricity transmission network in partnership with ADNOC and TAQA, with the entire project returning to ADNOC after 35 years of operation.

The project is subject to completing the necessary procedures and obtaining the approvals of the relevant regulatory authorities.

The project will contribute to consolidating ADNOC and TAQA's position and enhancing their efforts in the field of sustainability, in addition to supporting the UAE's strategic initiative to achieve climate neutrality by 2050, as the project will contribute to reducing carbon emissions from ADNOC's marine operations by more than 30% by replacing electricity generators. Existing gas turbines rely on more sustainable sources of electric power generation.

This joint venture will also increase operational efficiency, enhance the reliability of the power supply system, and potentially reduce electrical energy costs.

Yasser Saeed Al Mazrouei, CEO of ADNOC's Exploration, Development and Production Department, said: "We are pleased to cooperate with 'TAQA' on an innovative project that will attract global partners in the global energy sector and help us achieve a new important milestone in our ongoing path to reducing carbon emissions. As ADNOC strives to keep pace with the transformation. In the energy sector and ensuring its business continuity, this advanced and distinguished project will replace electric power generators in offshore fields with more sustainable and environmentally friendly electric energy sources, which will contribute to a significant reduction in carbon emissions, in addition to saving costs and enhancing the efficiency of operations.”

He added: "This first-of-its-kind project reinforces ADNOC's continuous efforts to develop practical and commercially viable solutions that contribute to reducing carbon emissions, while at the same time attracting large foreign direct investments, thus strengthening the position of the UAE and Abu Dhabi as a reliable global investment center."

More than 50% of the total value of the project will be redirected to the local economy through the ADNOC In-Country Value (ICV) program, confirming the commitment of ADNOC and "TAQA" to continue their efforts to promote sustainable investment and create value for the UAE and Abu Dhabi and drive growth and development for the local economy.

Jassim Hussain Thabet, Group CEO and Managing Director of TAQA, said: “TAQA is the leading low-carbon utilities company in Abu Dhabi and one of the top five integrated utilities companies in Europe, North Africa and the Middle East by market capitalization. We are pleased to enter into a new partnership with the Abu Dhabi National Oil Company (ADNOC) through this important project, which will contribute to decarbonizing the energy sector in the Emirate of Abu Dhabi in an efficient manner.”

He added: "This project is the first of its kind and demonstrates that the United Arab Emirates continues to play its leading leadership role and embrace innovation in the global march towards energy transformation, by uniting the efforts of key players in the energy sector to enhance sustainability and achieve maximum benefit in the use of the energy mix in The Emirate of Abu Dhabi, which is characterized by diversity and high efficiency, and the process of decarbonization provides opportunities for cooperation and growth on the social and economic levels, which is sought by "TAQA" through its alliances and strategic partnerships in the market." In turn, Seong Il Cheung, CEO of the Korea Electric Power Corporation (KEPCO), said: “We are honored to participate in this strategic project with ADNOC.While the Barakah Nuclear Energy Project has become a symbol of the long friendship and joint cooperation between the UAE and Korea, KEPCO will strive to successfully complete this project and contribute to the UAE's strategic initiative to achieve climate neutrality by 2050.

For his part, Kazuhiro Ikebe, President and CEO of Kyushu Electric Power Company, said: "The Kyoden Group is honored to have been chosen as a business partner and contributor to the implementation of this project, which helps reduce carbon dioxide emissions at ADNOC's oil production facilities by more than 30%. Kyoden Group recently announced a carbon neutrality action plan, and we are determined to contribute to advancing the efforts of energy companies that have projects and practical plans to reduce carbon emissions worldwide. We hope to contribute to the success of this project by benefiting from the knowledge and experience we have gained in the field The electric power sector in Japan and abroad.

For his part, Jean-Bernard Levy, Chairman and CEO of EDF, said: “We are pleased to award ADNOC and TAQA the project contract to a successful consortium that includes EDF and to benefit from its expertise in the field of electric power transmission networks. We at EDF are proud to participate in this innovative project that contributes significantly to reducing carbon emissions from ADNOC's operations."

The total installed capacity of the electricity transmission system will be 3.2 GW, and will include two subsea transmission links and two independent high-voltage direct current transfer stations, all connected to the onshore electricity network of the Abu Dhabi National Energy Company "TAQA", which is operated by the Abu Dhabi Transmission and Control Company (TRANSCO) for "energy".

It is expected that construction work will start in 2022, with commercial operation of the project starting in 2025.

The project also allows ADNOC to make more effective use of the gas currently used in gas turbines that generate electricity to operate offshore facilities and use it in other high-value areas, allowing for additional revenues.

A tender was launched for this innovative project in April 2020, which saw very high interest from international companies.

The consortium of companies implementing the project was selected following a highly competitive bidding process.

 It is noteworthy that this project comes on the heels of the recently announced global clean energy project between ADNOC, Mubadala and TAQA, which aims to generate a total capacity of at least 50 GW from renewable energy sources by 2030, and the prominent partnership in The field of clean energy with the Emirates Water and Electricity Company, which will see Emirates Water and Electricity supply up to 100% of ADNOC’s onshore production operations and more than 90% of ADNOC’s offshore production operations with the needs of its electrical network through electricity produced from nuclear energy sources And solar clean.

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