ADNOC Gas awards $8.2 billion projects amid Hormuz disruption

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ADNOC Gas has awarded $8.2 billion in engineering, procurement and construction contracts for two major gas processing projects as maritime disruption in the Strait of Hormuz continues to restrict product liftings.

The Abu Dhabi company reported second quarter net income of $665 million, exceeding its guidance range of $400 million to $600 million. Domestic gas demand and resilient margins helped offset security incidents at the Habshan complex and constraints on export movements.

The company also approved a quarterly dividend of $940 million, payable in September 2026, while maintaining its policy of increasing annual dividends by 5% through 2030.

Final investment decisions have been taken for Phases 2 and 3 of the Rich Gas Development project. The company said the expansion would support a revised target of 60% EBITDA growth by 2030 compared with 2023.

That replaces its previous goal of more than 40% growth between 2023 and 2029. ADNOC Gas now expects to invest approximately $28 billion between 2026 and 2030.

Wison Engineering received the $3.9 billion contract for Phase 2, which will add a natural gas processing train at the Habshan facility. The new infrastructure is intended to increase processing capacity and provide greater operating flexibility while supplying the UAE’s downstream and petrochemical industries.

Tecnimont secured the $4.3 billion Phase 3 contract. Its scope covers a natural gas liquids fractionation train at Ruwais, where higher value liquids will be separated from rich natural gas for export.

The two contracts follow the $5 billion committed to Phase 1 in June 2025. Total investment in the Rich Gas Development project has therefore reached $13.2 billion.

For project cargo and logistics providers, developments of this scale translate into prolonged demand for heavy equipment transport, modular cargo handling, port capacity and carefully sequenced deliveries. Gas processing plants are not assembled from a single shipment. They arrive as a complex flow of machinery, steelwork, pressure equipment and construction materials that must reach the site in the correct order.

The Rich Gas Development forms part of a wider program that also includes Ruwais LNG, Maximizing Ethane Recovery and Monetization, known as MERAM, and Estidama.

Together, the four projects are expected to generate $13.4 billion in In Country Value. MERAM is scheduled for delivery in 2027, while work on Ruwais LNG and Estidama is progressing.

Additional gas is expected to enter the company’s processing system through ADNOC’s Bab Gas Cap and Umm Shaif Gas Cap developments. These projects are intended to provide more feedstock, support higher processing volumes and increase the availability of natural gas liquids and LNG for export.

Chief Executive Officer Fatema Al Nuaimi described the investment decisions as a defining point for the company.

“With the final investment decision and contract awards for the Rich Gas Development Project, we are not only accelerating one of the world’s largest gas processing growth programs, we are raising our ambition, targeting 60% EBITDA growth by 2030,” she said.

Continued disruption to maritime traffic through the Strait of Hormuz affected ADNOC Gas product liftings during the second quarter. The company used inventory controls and alternative logistics planning while working with customers and supply chain partners to manage temporary constraints.

The disruption illustrates the difference between production capacity and deliverable supply. Gas products may be processed and ready for sale, but their commercial value depends on safe and predictable access to export routes.

ADNOC Gas expects third quarter net income of between $600 million and $800 million. That guidance assumes disruption to maritime movements through Hormuz continues during the period.

If maritime operations are fully restored by the fourth quarter and realized prices return to normal, the company expects full year 2026 net income of between $3.5 billion and $4 billion.

Operations at Habshan were affected by security related incidents on April 3 and April 8. ADNOC Gas said its response focused on personnel safety, restoring production and limiting disruption to customers.

Gas supply from the complex has already recovered to 85%, exceeding the target originally set for the end of 2026. The technical assessment of the incidents has also been completed.

The company is introducing more automated inspection equipment across its facilities, including aerial drones, four legged robots and tank climbing crawlers. ADNOC Gas estimates these systems could reduce inspection costs by as much as 75% and complete certain inspections up to 15 times faster, while limiting the need for personnel to enter hazardous areas.