Emirates looks to the future as a producer of sustainable energy

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The UAE has come a long way since the discovery of the first oil well and crude has become the country’s most important commodity, bringing wealth and prosperity to its people.

Today, 50 years later, the country is projecting itself into the next half-century, where hydrocarbons will no longer be the pillar of the world economy.

The United Arab Emirates are innovating with other regional and global producers to diversify their assets, improve their efficiency, turn to renewable energies as an alternative source and become a world leader in hydrogen development.

Oil and gas remain essential to the country’s development, however, with the Abu Dhabi National Oil Company, the national energy giant, continuing to invest in the development of hydrocarbon resources.

The United Arab Emirates accounts for around 4% of global oil production, with most of the production coming from fields owned and managed by Adnoc. The country is also on track to increase its overall production capacity to 5 million barrels per day by 2030.

The emirates, which generate electricity from gas, are also dramatically increasing the volumes of fuel, which is less carbon-intensive to meet its growing consumption needs.

The United Arab Emirates, OPEC’s third largest producer, consumes around 7.4 billion cubic feet (bcf / d) of gas per day largely to meet the demand for electricity, with a total share of fuel 30% imported, estimates the energy consulting firm FGE.

Abu Dhabi is prioritizing the development of gas from unconventional reserves, which are fields that were previously considered commercially unsustainable to mine.

The United Arab Emirates have announced the discovery of additional reserves of 7 billion barrels “stock tank” of oil, 58,000 billion cf of conventional gas and 160tcf of unconventional gas in 2019.

This propelled the country to the top of the rankings in terms of hydrocarbon reserves, according to data from the US Energy Information Administration.

Last year, the United Arab Emirates also announced the discovery of 80 tcf of shallow gas reserves in an area between Abu Dhabi and Dubai – the largest find in 15 years.

Adnoc has also advanced more efficient oil and gas production over the past five years, deploying big data and artificial intelligence to produce hydrocarbons more efficiently.

In February, Adnoc said it generated $ 1.1 billion in business value from deploying big data and analytics at its Thamama center, which oversees upstream operations. The company has achieved $ 2 billion in savings over the past five years by using advanced technology and digitization to optimize its drilling operations.

The Thamama center, named after Abu Dhabi’s most dominant reservoir formation, is part of the company’s continued investments in cutting-edge technology, digitalization and artificial intelligence, to increase l ‘efficiency.

Adnoc has also formed a joint venture known as AIQ with Abu Dhabi artificial intelligence company Group 42 to develop and commercialize AI products and applications for the oil and gas industry.

AIQ, Group 42 and Schlumberger, the world’s largest energy services company, have also entered into an agreement to develop and sell AI products for the global exploration and production market.

The UAE also plans to find other uses for the crude to meet growing global demand for chemicals, as well as establish a manufacturing hub in the country. The country plans to triple its petrochemical production capacity by 4.5 million tonnes – currently entirely produced by the Borouge plant in Ruwais – by 2025.

Adnoc is also a forerunner among regional energy companies in terms of opening up assets to foreign investment.

Even amid the pandemic, Adnoc helped attract Dh62 billion ($ 16.8 billion) in foreign direct investment to the UAE this year, mostly through various multi-billion dollar deals signed in segments. intermediaries and infrastructure.

Between 2016 and 2020, the state-owned company helped generate MAD 237 billion in FDI to the United Arab Emirates.

At the height of the pandemic, a consortium of the world’s leading infrastructure and sovereign funds signed a $ 20.7 billion deal to invest in Abu Dhabi’s gas pipeline infrastructure. The deal, the world’s largest energy infrastructure deal at the time and the largest in the Middle East, will unlock $ 10.1 billion in foreign investment in the United Arab Emirates.

Global Infrastructure Partners, Brookfield Asset Management, Singapore Sovereign Fund GIC, Ontario Teachers’ Pension Plan Board, South Korean firm NH Investment & Securities and Italian firm Snam have acquired stakes in Adnoc’s lucrative midstream assets.

Adnoc also entered into a $ 5.5 billion deal with Apollo Global Management to lease some of its properties, which resulted in an additional inflow of FDI of $ 2.7 billion.

The UAE has continuously tried to position itself ahead and in many ways is an indicator of changing regional market dynamics. It has embraced the energy transition by taking a leadership position in new fuels such as green and blue hydrogen, as it seeks to tap into the growing market for low carbon fuels.

Following the latest edition of the Abu Dhabi International Petroleum Exhibition and Conference, by The NationalAccording to the estimate, the week-long event resulted in more than $ 13.7 billion in investments pledged to develop the upstream and downstream sectors of the UAE. The figure only takes into account the planned investments and the attributions of Adnoc, and does not include the preliminary agreements of other companies.

The UAE, in line with global efforts to move away from fossil fuels, will also now host the 28th Conference of the Parties in 2023, following its commitment this year to reach net zero by mid-century.

The country made history by becoming the first Arab country to commit to offsetting all the carbon emissions it creates nationally before Cop26.

As the country looks forward to a new era away from oil, Adnoc is also adding renewables to its portfolio.

With Taqa, a major player in public services, Adnoc will form a joint venture to invest in renewable energies.

The companies have joined forces to create a global renewable energy and green hydrogen business that will have a production capacity of 30 gigawatts by 2030.

The two companies will join forces on national and international renewable energy and waste-to-energy projects, as well as on the production, processing and storage of green hydrogen.

Update: November 29, 2021, 5:30 a.m.


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