Abu Dhabi is indefinitely delaying construction of the first land-based facility for importing LNG into the United Arab Emirates after it contracted a floating suplly terminal.
EmiratesLNG LLC (a JV of two Abu Dhabi government-owned investment companies) is looking at other options for the planned onshore facility in the U.A.E. port of Fujairah.
Abu Dhabi has the world’s 7th-larget reserves of both oil and gas. Even so, it’s among Middle Eastern oil producers seeking greater gas supply to run power plants and industries amid rising growth. Kuwait and Dubai, the U.A.E.’s second-largest emirate, both import LNG via floating terminals, and Oman is in talks to buy gas by pipeline from Iran. The U.A.E. is also building four nuclear power plants, with the first to start next year.
“The U.A.E: is facing a crunch in gas supplies for power until the country’s nuclear plants come online,” Robin Mills, CEO at consultant Qamar Energy in Dubai, said “The floating terminal will help bridge the gap. They’re casting around for options for EmiratesLNG to see if it still makes sense”.
EmiratesLNG plans to build an onshore facility in Fujairah capable of importing 9 million tons of gas a year. Using the plant to store or resell LNG cargoes would allow Abu Dhabi to make use of any excess capacity. EmiratesLNG was planned for completion in 2018.