The new 244km pipeline that has a capacity to feed 350 million cubic feet of gas per day (cpd) into Fujairah, an emerging hub of cement manufacturing, will change the power supply equations in the emirate and strengthen its industrialisation efforts, industry insiders told Emirates Business.
Dolphin energy, the Abu Dhabi-based joint venture between Mubadala, Total and Occidental Petroleum announced recently that its engineers have completed the first phase - 128km pipeline link - that will allow transfer of gas between Taweelah in Abu Dhabi to power plants in Fujairah. The second phase of the pipeline, measuring 116km will be completed by the end of the third quarter this year will finally allow direct gas transfer between Abu Dhabi and Fujairah.
Dolphin that came into existence just 10 years ago, sources about 2 bn cpd gas from the northern fields in Qatar and supplies it to destinations within the GCC.
Considering gas is the cheapest fuel in the world today, the Qatari gas is credited for providing an equal platform to industries in Abu Dhabi, Qatar, Dubai and Oman. Particularly worth mentioning is the example of Sohar Aluminium, the Oman-based company that produces aluminium at competitive prices using gas provided by Dolphin as a feedstock. "The feedstock story does not become difficult for us. The Oman Government is able to bring gas to Oman at a competitive price. And they make it available to us at a competitive price," Bruce Hall, CEO of Oman-based Sohar Aluminium recently told this newspaper.
A new chapter to this impressive trend will be added in Fujairah at the end of third quarter this year when Dolphin completes work on the pipeline to supply gas to the emirate's upcoming 2,000 MWs F2 power plant.
"This new supply will help Fujairah meet its long talked about fuel shortage. It will help the emirate grow into a manufacturing hub something that it sincerely wants," said Dheeraj Shahdadpuri a Dubai International Financial Centre (DIFC) based energy analyst.
Sources say that Dolphin's gas is meant only for the upcoming 2000 MWs F2 IWPP power plant in Fujairah, and that there are no plans at least in the near future, to supply gas to industries in the emirate. However, Fujairah-based businessmen are buoyant over the fact that the supply will be a huge leap from the current 656 MWs installed capacity of an existing power plant. "When construction is finished, the new power plant will be the world's second largest IWPP project. Its adjunct desalination unit will also produce 591,500 cubic metres of water per day," the head of a company with a manufacturing facility at Fuzairah Free Zone said.
"Cement plants in Fujairah and Ras Al Khaimah alternate between coal and gas a feedstock depending upon which is cheaper. Cheaper power made available to them will certainly help," a senior employee in a Ras Al Khaimah-based cement company said.
The 128km link that has already been constructed, has a diameter of about 1.2 metres. It will allow Dolphin to propel 350 million cpd to a transfer station, from where it will be piped to the east coast. Abu Dhabi Water and Electricity Authority (Adwea) is the majority shareholder in Fujairah Asia Power Company that owns the upcoming power plant in Fujairah.
By Shashank Shekhar
© Emirates Business 24/7 2010
