EPC and EOR for ADNOC’s production ramp-upMay 2, 2023
Eyas Al Homouz, CEO of Petromal, talks to The Energy Year about the company’s growing footprint in EPC and how it is leveraging partnerships in this area, as well as its work on EOR for ADNOC’s depleting reservoirs. Petromal is the energy investment arm of National Holding. In the UAE, the company focuses on providing EPC and oilfield services.
What growing footprint does your EPC arm have and how are you leveraging partnerships?
As a local company, we are fully aligned with the UAE’s overarching vision. We are key partners for ADNOC, playing an important role in the execution of their plans. We are prequalified for 29 different services for ADNOC – as one of the few companies that have this type of prequalification – from building a refinery, all the way to drilling a well. In this regard, we are seeing growth in demand for our EPC services. Apart from participating in several of ADNOC’s tenders, we have taken on an array of different projects for them.
Considering the amount of work that is coming, and the limited resources and capabilities that we have as a local company, we are looking into consolidating new international partnerships. We are looking for companies that are interested in having a footprint in the UAE and that will add value to our operations. We have a size of projects that we can take on alone but we want to double the size of our projects by working with the right partner. We can do projects of up to USD 600 million-700 million, but to execute anything beyond that will require additional expertise and additional resources: manpower, equipment and in-house expertise.
ADNOC’s aim is to ramp up production capacity to 5 million bopd, and this requires a lot of new infrastructure and facilities. This is where we see more of an opportunity today, especially for our EPC segment. In this regard, we see EPC opportunities coming from both the upstream and downstream. There is plenty of infrastructure needed around new onshore and offshore field developments such as early production facilities, which means there will be plenty of work in the coming years. What’s more, we have already been involved in the infrastructure for some of ADNOC’s new fields, so we already have a recognised track record.
How important is your oilfield services unit and how are you aiding ADNOC in its depleting reservoirs?
Given ADNOC’s aim of increasing the UAE’s production capacity, we are also expanding our oilfield services segment and seeking to add new cutting-edge technologies we feel could be of value to ADNOC. For this area, we mainly carry out maintenance and shutdown work but we rely on outside technology. Partnerships are thus essential for us moving forward.
Our aim is to secure high-margin, high-efficiency projects. We are very niche in that regard. Moreover, we are very specialised in the area of EOR. A lot of oilfields in the UAE have declining production rates and one of ADNOC’s strategies is to enhance production and achieve quick production wins. EOR techniques have become key to ramping up oil flows in the country.
To this end, we have been working with ADNOC on different EOR techniques and pilot trials for these maturing fields. Unfortunately, there is not much local technology we can use, which forces us to rely on state-of-the-art technologies we have access to through our international partners.
What steps are you taking to be involved in renewables and implement sustainable solutions?
Renewable energy projects are in our growth plans for the near future. We are looking at some renewables projects in Africa, especially rooftop solar projects and small utility-scale ventures of 10-20 MW. We are looking at these types of opportunities here in the UAE as well. In this regard, we are looking to expand our EPC capabilities to include system integration for solar. We want to see how we can be part of this process moving forward, especially in Abu Dhabi.
Petromal is part of National Holding and they are looking at rooftop solar solutions for some of their other verticals. For instance, the holding owns different dairy plants and manufacturing facilities. Petromal would be involved in the installation of rooftop solar for these facilities.
We still believe in oil, but we want to be part of the energy transition. From here, we are trying to produce crude oil in the most efficient and environmentally friendly way. We are deploying the latest technologies to mitigate our carbon footprint. For example, we implemented an important flare gas reduction programme in Nigeria while in Congo we are using produced gas to power our platforms instead of flaring it.
Tell us more about your strong E&P presence in Central and West Africa.
We have offshore producing plays in Nigeria’s OML 113. We have now stopped production on the FPSO and are replacing it with a new one that will be able to handle the gas processing. At the same time, we are building a gas-to-shore pipeline. We are now engaging with local offtakers and other partners as our intention would be to use the West African Gas Pipeline to distribute our gas to countries such as Benin and Togo.
In addition, we are present in Congo-Brazzaville, where we have an asset, the PNGF Sud field, with a gross production of around 30,000 bopd. Interestingly, we took it over from Eni and Total in 2016 and managed to bring the production from 12,000 bopd to 30,000 bopd.
We also have two exploration assets, in Gambia and Guinea Bissau, and Senegal is on our radar as well. When it comes to Africa, we are opportunistic. We are looking for brownfields in Angola, Nigeria or Congo-Brazzaville where we can take over and apply our EOR expertise to enhance production. Around 70-80% of our activities are focused on Africa, while 20-30% come from the UAE.
What interest does Petromal have in penetrating the gas market in Kazakhstan?
In Q1 2023, we signed an MoU with QazaqGaz, Kazakhstan’s state-owned gas pipeline operator with ambitious plans to become a major gas producer, along with Dragon Oil for the QazaqGaz-led exploration and development of new gas assets in the country. This will potentially involve E&P activities in different gasfields, as well as knowledge transfer so they can improve their operations. Part of the work will be consulting services, where we help them in certain G&G [geological and geophysical] work, and subsurface studies.
The MoU also calls for us to consider jointly building a gas processing plant in the country. The country needs gas processing plants and gas infrastructure development for its fields. This is part of our strategy of looking for opportunities in Central Asia.