The Emirati national oil company (NOC) Abu Dhabi National Oil Company (Adnoc) and the State-owned utility AD Power have formed a joint venture to study and develop Lightning project, a subsea high-voltage direct current (HVDC) transmission grid to supply power from shore to the various facilities in operations offshore Abu Dhabi in the United Arab Emirates (UAE).
The purpose of this project is to improve the energy efficiency of the offshore oil & gas operations and to reduce the carbon dioxide (CO2) emissions.
Abu Dhabi Government is keen to show that it contributes to the reduction of the global warming in the same time as it can reduce its gas consumption at a period it is investing heavily to build up its gas independence from Qatar.
Adnoc is expecting to reduce its gas consumption and its CO2 emissions by 30% compared to the current solution.
Currently, Adnoc is using local gas-fired turbines on each facility, but it should produce electrical power onshore to optimize conditions.
In addition the maintenance costs of the power turbines onshore will be far much cheaper than the accumulation of the maintenance costs of the series of industrial turbines running offshore.
To do so, Adnoc is considering to use subsea HVDC transmission technology on Lightning project, enabling to transport large power over long distances with nearly no losses.
In a first step, this subsea grid should be connected to AD Power national grid with a transportation capacity of 3200 MW.
In this project, Adnoc and AD Power would hold 30% each and would offer the remaining 40% to a foreign operator in business model where this company should build, own, operate and transfer (BOOT) the subsea grid after a period of 10 or 15 years.
This so-called Lightning Project should be tendered in this BOOT basis after the completion of the front end engineering and design (FEED) work in 2021 for a sanction in 2022 and first operations in 2025.
— July 2020 —
Abu Dhabi Authorities are keen to show example in Climate Change policy in speeding up the project‘s development.
Adnoc should replace the offshore gas turbines by electrical motors and drives which should reduce offshore CO2 emissions by 30%.
The needed electrical power shall be generated from nuclear and renewable energies solutions.
Adnoc and AD Power selected Mott McDonnald to provide the technical support.
The transmission system will comprise two independent subsea HVDC transmission links and converter stations that will connect to AD Power’s onshore electricity grid with its subsidiary, Abu Dhabi Transmission & Despatch Company (Transco).
So far, the following companies have submitted an expression of interest for the proposed BOOT contract:
- China Southern Power Grid from China
- China State Grid Corporation of China
- Kansai Power from Japan
- Kepco from South Korea with EDF from France and Kyuden International Corporation (KIC) from Japan
- Terna Spa from Italy
- Vision Invest (formerly Acwa Holding) from Saudi Arabia) with Elia from Belgium
The sanction of the engineering, procurement and construction (EPC) contract should be awarded in late 2021 or early 2022 as the installation should come in power by 2025.
— July 2020 —
This project is attracting many players as it will represent a key reference for any companies involved in energy transition.
So the first bidders are building consortia in order to share the risk and bring together all the competences required, not only for the EPC phase, but also for the operation stage when built.
So, the teams in competition are:
- China Southern Power Grid from China
- China Offshore Oil Engineering Company (COOEC) with China State Grid Corporation of China
- Larsen & Toubro (L&T) from India with Kansai Power from Japan
- Petrofac from UAE with Vision Invest (formerly Acwa Holding) from Saudi Arabia with Elia from Belgium
- Saipem with Terna Spa both from Italy
- Samsung Engineering & Construction with Kepco from South Korea with EDF from France and KIC from Japan
This bidders list is not definitive yet and may change again with the applications of more players along the year 2020.
— September 2020 —
The project is going to be awarded on BOOT business model instead of a conventional EPC contract.
Therefore the bidders must combine engineering capabilities with operating capacities.
Each team must perform its own FEED work to calculate and submit a price.
In this context only four teams of companies are biding:
- COOEC with China State Grid Corporation of China
- L&T from India with Kansai Power from Japan
- Petrofac from UAE with Vision Invest (formerly Acwa Holding) from Saudi Arabia with Elia from Belgium
- Samsung Engineering & Construction with Kepco from South Korea with EDF from France and KIC from Japan.
Originally thought to be awarded in 2022, the BOOT contract should be sanctioned in 2021 as Abu Dhabi wants to speed up its carbon foot print reduction.
— Mars 2021–
The recent increase of barrel price is comforting the project schedule as ADNOC has closed the project financing. From the four consortium listed, two have taken the lead to go in detailed negotiations:
- Petrofac from UAE with Vision Invest (formerly Acwa Holding) from Saudi Arabia with Elia from Belgium
- Samsung with Kepco from South Korea with EDF from France and KIC from Japan
ADNOC and AD Power should be awarding the project in late Q2 2021.
— August 2021 —
ADNOC and AD Power are is pushing to award the project Lightning before the end of summer. In fact, the barrel price staying high is comforting both operators in their investment.
AD Power has now merged with TAQA to become a single utility.
ADNOC and AD Power will award both subsea HVDC transmission lines of Lightning project to the Joint venture composed of Samsung with Kepco from South Korea with EDF from France and KIC from Japan.
Both lines will be connected to the onshore grid via two converter stations.
ADNOC and AD Power are targeting 2025 for the project completion.
— January 2022 —
Samsung awarded the HVDC subsea transmission system to Hitachi Energy (formerly ABB-Hitachi).
The scope of work consists of two independent subsea HVDC transmission links of approximately 1,000 MW and 600 MW.
Next to the HVDC transmission, the Lightning project should include onshore and offshore HVDC converter stations in Abu Dhabi.
The transmission system will comprise two independent subsea HVDC transmission links and converter stations.
These transmission will be connected to Taqa onshore electricity grid with its subsidiary, Abu Dhabi Transmission & Despatch Company (Transco).
Hitachi Energy will supply four converter stations, which convert AC power to DC for transmission in the subsea cables, then reconvert it to AC from DC for use in the offshore power systems. Also included in the order are system studies, design and engineering, supply, installation supervision and commissioning.
— April 2022 — Adnoc awarded a project management and supervisory consultancy contract to Kent (formerly SNC Lavalin) for the project.
— September 2022 — Adnoc took the final investment decision (FID) for $3.6 billion.
— April 2023 — CRP Subsea will perform the EPCI to deliver cable protection services.
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