Construction

Adnoc, ADPower to develop first-of-its-kind transmission system in the MENA region

Adnoc, ADPower to develop first-of-its-kind transmission system in the MENA region

Abu Dhabi National Oil Company (Adnoc) and Abu Dhabi Power Corporation (ADPower) have said that they are issuing a joint tender for the development and operation of a high-voltage, direct current HVDC sub-sea transmission system.

A first-of-its-kind project in the MENA region, this will connect Adnoc’s offshore production facilities to ADPower’s onshore electricity grid using state-of-the-art technology. Requests for proposal have been sent to international companies that have the requisite experience to partner with itself and ADPower, Adnoc said in a statement.

The transmission system will have two independent sub-sea HVDC transmission links and converter stations that will connect to ADPower’s onshore electricity grid, which will be operated by its subsidiary, Abu Dhabi Transmission and Despatch Company, Transco – and provide a total installed capacity of 3,200 MW.

Adnoc said that the project will be funded through a special purpose vehicle jointly owned by Adnoc (30 percent), ADPower (30 percent) and the selected developers and investors who will have 40 percent stake. It will be executed on a build, own, operate and transfer model and is expected to start commercial operations in 2025.

Yaser Saeed Al Mazrouei, executive director at Adnoc Upstream, said: “This project will meet our future offshore power needs, even as our fields mature, using diverse and sustainable sources. It will lower Adnoc and the UAE’s carbon footprint, whilst at the same time enabling Adnoc to utilise the natural gas currently used to power our offshore facilities for higher-value purposes.”

“Equally, the project will deliver operational expenditure reductions in the long run as well as lasting strategic benefits as we continue to drive sustainable value and responsible investment opportunities that stimulate economic growth for Abu Dhabi and the UAE in the current market environment.”

Successful bidders, alongside Adnoc and ADPower, will develop and operate the transmission system, with the full project being returned to Adnoc at the end of the transmission agreement, it added in the statement.

Meanwhile, Omar Alhashmi, executive director Asset Management at ADPower, added that working together [with Adnoc], they are reinforcing Abu Dhabi’s global position as they implement this first-of-a-kind mega project that will not only create synergy between two critical industries, but drive the emirate’s economic growth through long-term value creation.

The project also offers potential for Adnoc to more effectively utilise its rich gas – currently used to power the offshore facilities – for higher-value purposes, allowing Adnoc to generate additional revenue. Moreover, the project is expected to reduce the carbon footprint of Adnoc’s offshore facilities by up to 30 per cent through ADPower’s efficient onshore power production.

Adnoc also stated that this project offers power supply cost optimisation potential for Adnoc’s offshore facilities by replacing the existing offshore localised gas turbine generators with diverse, more efficient and environmentally sustainable sources of energy, including renewable and nuclear power.

 

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