Austria-headquartered oil and gas player OMV has struck a deal with Lukoil Gulf Upstream, a subsidiary of Russia’s Lukoil, to divest its stake in a giant sour gas development off the coast of the United Arab Emirates (UAE).
While revealing the signing and closure of an agreement to sell its 5% stake in the Ghasha concession to Lukoil Gulf Upstream, OMV highlights that the overall cash consideration amounts to $594 million, less a $100 million transaction fee.
Abu Dhabi’s Ghasha concession, said to be the world’s largest offshore sour gas development, is owned by a consortium led by Abu Dhabi National Oil Company (ADNOC), which holds a 70% stake. As OMV has opted to dispose of its interest, the list of other shareholders will now include Eni (10%), PTTEP (10%), and Lukoil (10%).
The concession comprises multiple projects, encompassing the Hail , Ghasha, Dalma , Nasr , Satah al Razboot (SARB) , Bu Haseer , Shuweihat , and Mubarraz offshore sour gas fields. ADNOC made a final investment decision (FID) in 2023 and handed out a batch of contracts for the Hail and Ghasha offshore gas development.
The first steel for structures that would be placed at the massive sour gas development was cut last year. The development, which will entail fully unmanned offshore facilities, aims to operate with net-zero carbon dioxide (CO2) emissions, supporting the UAE player’s net-zero by 2045 ambition.
This project is part of the Ghasha concession, a key component of ADNOC’s integrated gas masterplan and an important enabler of gas self-sufficiency for the United Arab Emirates, which is set to produce more than 1.5 billion standard cubic feet per day (bscfd) of gas before the end of the decade.
The Hail and Ghasha development design combines decarbonization technologies into one integrated solution, aiming to capture 1.5 million tonnes per year (mtpa) of CO2, taking ADNOC’s committed investment for carbon capture capacity to almost 4 mtpa.
While OMV has decided to close its Ghasha chapter in the UAE, the firm is actively working to fortify its hydrocarbon reserves, as illustrated by its Norwegian subsidiary’s exploration drilling activities in the Norwegian Sea.