Report summaryShah is an onshore oil and gas field located about 200 kilometres south of Abu Dhabi city. Appraisal of the sour gas in the Jurassic reservoirs started in the late 1990s. In 2006 Abu Dhabi's national oil company, ADNOC, invited companies to bid for the Shah Gas Development. ConocoPhillips was initially selected in 2008 but the company withdrew in 2010. In January 2011, Occidental announced its participation in the project, and the joint venture agreement with ADNOC was ratified in March 2011. The gas is highly acidic. It contains 23%-30% hydrogen sulphide as well as high levels of carbon dioxide. Sulphur is granulated at Shah and transported by rail to a terminal at Ruwais on Abu Dhabi's Gulf coast. We assume a low sales gas price of between US$1.20 and US$1.50 per mcf. As a result, project value is driven by associated liquids (condensate and LPGs) and is sensitive to liquids prices and production.
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