ROME, (Reuters) – Royal Dutch Shell plans to begin supplying liquefied natural gas (LNG) to Dubai in the peak demand summer period from 2010 after signing deals with the emirate and QatarGas, a Shell executive said on Sunday.
Shell aims to supply around 1.5 million tonnes of LNG a year, said Martin Trachsel, Shell’s vice-president for gas and power in the Middle East Gulf.
Some of the gas will come from Qatar, and some from elsewhere in Shell’s portfolio, he told Reuters on the sidelines of an energy conference in Rome.
The supply deal with QatarGas extends for about 15 years.
“We are delighted to be assisting Dubai in this project and we believe it will offer cost-competitive and clean energy supply for Dubai for many years to come,” Trachsel said.
Dubai, one of seven states in the United Arab Emirates, is harnessing the Gulf Arab region’s windfall from record oil prices to develop tourism, trade and financial services.
Demand for power and water in te emirate is surging by more than 20 percent a year driven by rapid economic and population growth, Dubai Electricity and Water Authority (Dewa) said in November.
Trachsel said Dubai Supply Authority (Dusup) had signed a separate deal to bring a vessel to receive the LNG imports and regasify them for supply into the emirate.
The vessel will be moored at Jebel Ali port, avoiding the need to build an expensive terminal, he said.
LNG is natural gas cooled to liquid form so it can be loaded on special tankers. The liquid is then delivered to receiving terminals where it is regasified and pumped into onshore pipelines.
London-based MEED magazine reported on April 11 Dusup had invited contractors to qualify for the construction of a terminal to import LNG from Qatar, Egypt and Asia at Jebel Ali.
The terminal would be ready by the first quarter of 2010, MEED said without saying where it got the information.