Exclusive: Kentz CEO on $30 million ADGAS contract
Abu Dhabi is upstream powerhouse of the next five years says O'Donnell
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Engineering and construction group Kentz has recently been awarded a contract worth in excess of US$30 million by Abu Dhabi Gas Liquefaction Company (ADGAS), a further signal that the UAE capital will be a hive of upstream activity in the years to come, according to Kentz CEO Dr. Hugh O'Donnell.
ADGAS, an Abu Dhabi National Oil Company (ADNOC) subsidiary, awarded the contract to replace the existing control system and electrical instrumentation devices on Das Island.
The design team has already begun mobilisation and construction completion is scheduled for 2012. “The whole project is being done as a hot cutover project, which means that the facility will keep running throughout as the new control system is installed element by element,” said O’Donnell.
“Kentz’s work is a full EPIC contract includes the design and detailed engineering, procurement, installation, construction, pre-commissioning, commissioning and transfer of the existing field instrumentation to a new control system for the ADGAS LNG, LPG, sulphur storage and jetty loading facilities,” O’Donnell told ArabianOilandGas.com. “They will then be integrated into the existing systems of the three LNG/LPG processing facilities.”
Essentially, the project will be a complete modernisation of the ‘brain’ behind the process facilities.
O’Donnell added that now has been a good time to strike for ADGAS, as project costs are significantly below their highs of 2008. “Typically EPC project prices in the Middle East have come down, because they have a large procurement element, and raw materials and commodity costs have come down significantly. In some areas that’s reflected by the overall price submitted to clients, so there are genuine cost reductions, and our submission included the most up to date cost revisions which we have passed on to the client.”
O’Donnell said he is confident that the costs advantages available this year can be passed on throughout the project, despite its three year timeframe.
“We will be able to lock in most of the critical equipment very early on in the procurement phase because we have pre-selected vendors in our tendering phase. The element that may see cost inflation in 2011 and 2012 would be more associated with our site management and labour teams, and that’s much more under our control.”
O’Donnell added that the UAE capital will continue to prove a big draw as it ploughs ahead with some of the Middle East’s most ambitious oil and gas projects. “Abu Dhabi is the powerhouse of the region for the next five years. With Habshan, Borouge 2 and Ruwais, added to the Shah sour gas projects, I think it is fair to say the most significant investments in the region are coming out of Abu Dhabi, and I think all the regional players will be focused on those projects.”