UAE’s Shah Gas Development project will play a major role in meeting rising domestic demand, as the emirates have announced plans to increase power generation.
The Shah project is the UAE’s first attempt to produce sour gas and is expected to add 5mn cubic feet gas per day.
It is a joint venture between Abu Dhabi National Oil Company (Adnoc) and Occidental Petroleum.
The Shah gas field is located in the Abu Dhabi’s Liwa desert and is anticipated to come online early next year.
Although sour gas processing is relatively costly, it makes up the majority of the UAE’s natural gas with natural gas making up 99% of Abu Dhabi’s power generation.
The UAE’s energy demand has been growing at about 9% a year. Between 2008 and 2012 it saw the staggering 37% increase.
Experts say if national power consumption and economic growth continues at the same rate, demand is expected to rise by 11.3% each year, forcing Abu Dhabi to tap the more difficult gas.
The UAE has been looking to diversify its energy mix and has set itself the goal of generating 24% of its total power generation by clean energy projects by 2020.
“We continue to draw a clear strategy in energy, and we believe our economy is based on diversification,” the UAE Minister of Energy Suhail Al Mazrouei said last week.
The Minister of Economy Sultan Al Mansouri said that the country was the front-runner for branching out from the oil and gas sector.
“The UAE is the most diversified economy in the Middle East,” Mr Al Mansouri said.
A number of solar projects will also play a key role in diversifying the UAE’s energy mix. The second phase in the Mohamed bin Rashid Al Maktoum Solar Park will generate 100 megawatts of solar photovoltaic (PV) power.
The tender for the second phase of the project was issued on 20th of November and is expected to be completed in 2017.
