Adnoc Completes Transaction for Lightning’s Landmark $3.8 Billion Subsea Power Contract

Abu Dhabi National Oil Company (Adnoc) and compatriot Taqa have announced the financial close of a $3.8 billion contract for its Lightning project, which aims to reduce carbon emissions at the giant’s offshore oil and gas facilities audience.

Adnoc confirmed the development on Friday and said foreign direct investment had brought in more than $3 billion combined from commercial lenders, export credit agencies and the consortium led by Korea Electric Power Corporation (Kepco) which won the work contract on a giant underwater energy transmission system for Éclair.

The Kepco-led consortium, which also includes Japan’s Kyushu Electric Power and France’s EdF, will build, own, operate and transfer the transmission system alongside Adnoc and Taqa, with the full project returning to Adnoc after 35 years of development. exploitation, Adnoc noted.

The emirate giant confirmed the contract award last year and said the Lightning project would be funded by a special-purpose vehicle, in which Adnoc and Taqa would each hold a 30% stake, the balance 40%. % being held by the consortium.

Adnoc said Project Lightning “has progressed rapidly from the design phase to the development phase with construction beginning in early 2022, underscoring both Adnoc’s and Taqa’s leadership positions in driving climate action. “, and supporting the United Arab Emirates’ Net Zero by 2050 strategic initiative.

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The company said the project, originally announced last December, will now have a higher project cost of $3.8 billion – due to higher interest rates – compared to $3.6 billion previously. advertisement.

Adnoc Chief Executive Sultan Ahmed al-Jaber said that as a “responsible provider of reliable, low-carbon energy”, his company will continue to work with partners to advance practical solutions. and commercially viable involving the energy transition.

Taqa Chairman Mohamed Hassan Alsuwaidi said: “Financial close is a significant milestone for this distinctive project, which will see Taqa supply Adnoc’s offshore facilities with low-carbon energy in a safe and efficient manner through the system. power grid of Abu Dhabi Transmission & Despatch Company (Transco). ”

Adnoc said earlier that Project Lightning will see the development and operation of a “first high voltage direct current (HVDC) subsea transmission system in the Middle East and North Africa”.

The project will power Adnoc’s offshore generation operations with cleaner and more efficient energy, supplied by Abu Dhabi’s onshore power grid, owned and operated by Taqa’s transmission and distribution companies, he said. added.

Adnoc said the subsea development is expected to reduce the carbon footprint of its offshore operations by more than 30%, replacing existing offshore gas turbines with more sustainable power sources available from Abu’s onshore power grid. Dubai.

The submarine transmission system will have a total installed capacity of 3.2 gigawatts and will include two independent submarine HVDC links and converter stations that will connect to Taqa’s onshore power grid, operated by its subsidiary, Transco.

Robert M. Larson