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Monday, 26 September 2022

Adnoc hits financial close on a USD 3.8 bn project to make its offshore operations less carbon intensive

Adnoc and Abu Dhabi’s Taqa reach financial close on USD 3.8 bn subsea energy transmission project: State-owned Abu Dhabi National Oil Company (Adnoc) and government-controlled Abu Dhabi National Energy Company (Taqa) have reached financial close on a USD 3.8 bn project that will see them build what they say is a “first-of-its-kind” subsea transmission network in MENA, designed to reduce emissions at its offshore production facilities, according to a statement from Adnoc published on Friday. The high-voltage direct current (HVDC) transmission system will include two subsea links and converter stations and will have a total installed capacity of 3.2 GW. Construction began in early 2022 and is expected to begin operations in 2025.

But Enterprise, how exactly does using a subsea transmission network slash emissions at offshore production infrastructure? Offshore platforms usually generate their own electricity through gas turbines or diesel generators — but replacing these onboard generating systems with power from the mainland transmitted through subsea cables can significantly reduce CO2 emissions. Because of their design, HVDC subsea cables are particularly effective in transmitting energy over long distances in an energy-efficient way.

Adnoc says its network will be powered with more sustainable energy sources: The statement says that the project will replace Adnoc’s existing offshore gas turbine generators with “more sustainable power sources” but doesn’t disclose where it will get its energy from.

Who’s involved: Adnoc and Taqa will be joined by a consortium consisting of Korea Electric Power (KEPCO), Kyushu Electric Power Company (Kyuden) and France’s EDF. Adnoc and Taqa each own a 30% stake in the project, while the consortium collectively owns the remaining 40% stake.

Higher interest rates are driving up the costs: The total cost of the project is now USD 3.8 bn, up from the USD 3.6 bn figure first announced in December 2021 because of higher interest rates, the statement says.

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