US independent Occidental is poised to bid for an estimated $10 billion sour gas development in Abu Dhabi, while UK player BG Group has decided to pull out of the race, company officials said.
Abu Dhabi National Oil Cmpany (Adnoc), which produces almost all the oil in the United Arab Emirates, has prequalified a number of international players, including Occidental, BG, BP to submit bids for the project by 15 April.
Occidental, BP and Shell are preparing to submit a final proposal on how to develop the scheme.
However, BG has decided to pull out of the race.
"We were obviously delighted to be shortlisted and invited by Adnoc to bid for what is a very challenging sour gas project," a BG spokeswoman told Dow Jones Newswires in an email earlier this week.
"However, in the time available we concluded that we were not able to put together a sufficiently competitive compliant bid to address the significant challenges this project presents. Given our experience with sour gas in projects like Karachaganak in Kazakhstan, we are disappointed that we felt unable to submit a bid," the spokeswoman said.
It is not clear whether ExxonMobil which has also been preselected by Adnoc, will participate in the final stage of the tender.
The successful bidder will enter into a joint venture with Adnoc to help it develop some of Abu Dhabi's fields containing sour gas. Abu Dhabi has more than 200 trillion cubic feet of gas reserves, the fifth largest in the world, most of which are sour.
The sour gas project, which is expected to produce 3 billion cubic feet per day of gas, is set to provide gas for the emirate's new industries and for reinjection in oilfields to maintain production levels.
© Upstream 2007
