[UAE] Ruwais LNG

[escveritas]

Shell to invest in Ruwais LNG project in Abu Dhabi

10 July 2024

Abu Dhabi − Shell Overseas Holdings Limited, a subsidiary of Shell plc (Shell), has signed an agreement to invest in the Abu Dhabi National Oil Company’s (ADNOC) Ruwais liquefied natural gas (LNG) project in Abu Dhabi through a 10% participating interest. The Ruwais LNG project is located some 240 kilometres west of Abu Dhabi, United Arab Emirates.

“This investment decision builds on our long-standing partnership with ADNOC," said Shell's Chief Executive Officer Wael Sawan. "In line with our strategy to create more value with less emissions, we are investing in additional LNG capacity and further growing our world-leading LNG portfolio, with energy-efficient and carbon-competitive projects."

The Ruwais LNG project will consist of two 4.8 million metric tonnes per annum (mmtpa) LNG liquefaction trains with a total capacity of 9.6 mmtpa. Shell, through its subsidiary Shell International Trading Middle East Limited FZE, has also signed an agreement to offtake 1 mmtpa of LNG produced by the project. The Ruwais LNG facility is set to have an electric-powered liquefaction system and will utilise access to a renewable power supply. This design supports lower operational emissions compared to traditional gas-powered LNG facilities.

ADNOC will hold a majority 60% share in the project and serve as the lead developer and operator of the facility, while Shell, BP, Mitsui and TotalEnergies will each hold 10%.

ADNOC has awarded an engineering, procurement and construction (EPC) contract to a Technip-led joint venture and will soon start construction in Al Ruwais Industrial City, Abu Dhabi. LNG deliveries are expected to start in 2028.

[escveritas]

Final Investment Decision for the Ruwais LNG Project in UAE

11 July 2024

Mitsui & Co., Ltd. ("Mitsui", Head Office: Tokyo, President and CEO: Kenichi Hori) announces today that through its wholly owned subsidiary MBK Investment Management Netherlands B.V. ("MIM"), it has made a final investment decision with project partners (referred to as "Project Investors" below) on the Ruwais LNG project ("Project"). This Project is led by Abu Dhabi National Oil Company ("ADNOC") in Al Ruwais Industrial City, Abu Dhabi, United Arab Emirates.

The Project is a midstream natural gas liquefaction project with an annual production capacity of 9.6 million metric tons that is scheduled to commence production in 2028. The development costs for the project primarily consist of the EPC cost for the LNG plant. The contract value of the EPC for the LNG plant is approximately USD 5.5 billion*1 (approximately JPY 0.9 trillion), which would equate to costs of USD 550 million*1 (approximately JPY 88 billion) for MIM in line with their equity share.

Having initially invested in the ADNOC LNG project in the 1970s, Mitsui has been expanding its LNG business globally. Through the strong relationship with ADNOC spanning approximately 50 years, we have been selected as a joint venture partner for this Project and have agreed upon the key terms regarding LNG offtake. Mitsui has identified Global Energy Transition as one of its Key Strategic Initiatives in its Medium-term Management Plan 2026.

Mitsui considers that natural gas and LNG will play an important role during this transition and sees them as what we call real solutions. In addition to contributing to the long-term stable earnings base, the Project will also be a low-carbon LNG project that will have measures to reduce GHG emissions at the LNG production stage by adopting an E-Drive design*2 and utilizing clean power, contributing to the sustainable transition to a decarbonized society. Mitsui will continue to contribute to the stable supply of energy, the enhancement of quality of life, and sustainable social development through pushing forward its global natural gas and LNG business.