Abu Dhabi – Mubasher: ADNOC Gas has awarded two contracts worth $550 million to expand the UAE's natural gas pipeline network through the ESTIDAMA project.
The engineering, procurement, and construction (EPC) deals were granted to NMDC Energy, a subsidiary of National Marine Dredging Company (NMDC), and Galfar Engineering, according to a press release.
Around 70% of the deal’s value is expected to be retained locally under ADNOC's in-country value programme.
ESTIDAMA will extend the network from 3,200 kilometres to over 3,500 kilometres, boosting gas deliveries to Northern Emirates customers.
While ownership of the project is transferred to ADNOC to optimise capital efficiency, ADNOC Gas will continue managing construction and pipeline operations.
It will pay ADNOC a variable fee to transport gas through ESTIDAMA while earning revenue operating and maintaining the expanded infrastructure on ADNOC's behalf.
Ahmed Alebri, CEO of ADNOC Gas, said: “This award supports the ongoing expansion of the UAE’s gas pipeline network, which will bring lower-cost and sustainable natural gas to more locations across the country.”
“With the transfer of ownership of the ESTIDAMA Project to ADNOC, ADNOC Gas will continue to benefit from the expansion of the pipeline networks, while improving our capital efficiency to ensure that we maximise value for our shareholders,” Alebri added.
ADNOC Gas logged a 15% an annual leap in revenues to $6.01 billion during Q1-24 from $5.22 billion in the comparative period a year earlier.
It is worth noting that NMDC posted a consolidated net profit of AED 641.06 million in the first quarter (Q1) of 2024, a jump from AED 303.32 million in Q1-23.
