Coming in as one of the world’s largest natural gas discoveries in recent years, the United Arab Emirates (UAE) announced earlier this month that it has hit on 80 Tcf of shallow gas resources between Saih Al Sidirah and Jebel Ali in the Emirates of Abu Dhabi and Dubai, respectively.
Known as Jebel Ali, the discovery is expected to go a long way toward achieving the nation’s goal of natural gas self-sufficiency.
The discovery was made within an area of 5,000 square kilometers between the two emirates, with the Abu Dhabi National Oil Co. (ADNOC) drilling more than 10 exploration and appraisal wells, signifying the first time ADNOC has explored for hydrocarbon resources in Dubai. The UAE classified the discovery as “shallow gas,” as it contains high-quality organic gas at relatively shallow depths from the earth’s surface.
In commenting on the find, Rystad Energy analyst Palzor Shenga said it is too early to verify Jebel Ali’s total volumes because of the play’s wide land area. More appraisal wells will be needed to pinpoint the exact extent of the hydrocarbon spill point.
“However, even if this new discovery turns out to have only 8 Tcf of recoverable resources -- one-tenth of the preliminary official estimate -- that would still be enough to enable UAE to become energy independent by 2030, potentially removing its reliance on import volumes from neighboring countries like Qatar,” Shenga said in a note. “We also see a decline in domestic gas demand after 2030 that will further limit the need for imports.”
The research and analysis firm noted that natural gas in the UAE is the primary fuel for power generation, with electricity demand projected to reach 157 TWh by the end of 2020.
“In addition, the country uses gas for reinjection into oil fields as part of enhanced oil recovery projects,” Shenga added. “To meet this growing demand, the UAE is moving forward with development of sour gas fields that were discovered in the 1980s.”
ADNOC and Dubai Supply Authority (DUSUP) said they plan to continue to explore and develop the play. ADNOC said it is utilizing both conventional and unconventional drilling, as well as completion technologies and methods in the play, including horizontal drilling and hydraulic fracturing to enable optimal productivity while reducing the number of drilling rigs required.
As part of ADNOC’s 2030 strategy, the company said it also plans to tap its gas caps, which lie on top of and in contact with oil reservoirs, and substantial unconventional gas reserves, as well as new natural gas accumulations, which would continue to be appraised and developed as the company pursues exploration activities.
The Jebel Ali announcement comes less than three months after Abu Dhabi’s Supreme Petroleum Council (SPC) announced increases in hydrocarbon recoverable reserves of 7 billion stock tank bbl (STB) of oil and 58 Tcf of conventional gas, which the UAE said moves the nation to the sixth position in both global oil and gas reserves rankings with a total of 105 billion STB of recoverable oil, 273 Tcf of conventional gas and 160 Tcf of unconventional gas resources.
“The strategic cooperation agreement between ADNOC and DUSUP is a natural evolution of our shared commitment to harness energy resources in the service of the UAE,” said UAE Minister of State Sultan Ahmed Al Jaber, who is ADNOC Group CEO. “We look forward to swiftly progressing the ongoing work and further exploring, appraising and developing the area by leveraging ADNOC’s best-in-class expertise and innovative technologies to ensure the success of the project. We see significant potential in this joint project to create long-term and enduring value for the nation.”
Shenga said ADNOC and Dubai agreeing to jointly develop the new gas find is a “promising sign” that “could expedite the development of the new resource and bring additional gas volumes by 2025.”