Shell plc's subsidiary, Shell Overseas Holdings Limited, has signed an agreement to invest in the Abu Dhabi National Oil Company’s (ADNOC) Ruwais liquefied natural gas (LNG) project in Abu Dhabi through a 10% participating interest. The project will consist of two 4.8 million metric tonnes per annum (mmtpa) LNG liquefaction trains with a total capacity of 9.6 mmtpa. Shell will also offtake 1 mmtpa of LNG produced by the project. The Ruwais LNG facility is set to have an electric-powered liquefaction system and will utilize access to a renewable power supply, supporting lower operational emissions compared to traditional gas-powered LNG facilities. ADNOC will hold a majority 60% share in the project, while Shell, BP, Mitsui, and TotalEnergies will each hold 10%. The construction is set to begin soon, with LNG deliveries expected to start in 2028.
Shell's CEO, Wael Sawan, highlighted the company's strategy to create more value with fewer emissions, stating, "We are investing in additional LNG capacity and further growing our world-leading LNG portfolio, with energy-efficient and carbon-competitive projects." The investment aligns with Shell's ambition to deliver 25-30% growth in liquefaction volumes, relative to 2022, as outlined during the 2023 Capital Markets Day. The company believes that LNG will play a critical role in the energy transition, replacing coal in heavy industry and power generation, and providing flexibility to the power system as renewable generation grows rapidly.
The Ruwais LNG project is located in Al Ruwais Industrial City, Abu Dhabi, and is expected to contribute to meeting the rising global demand for LNG, estimated to increase by more than 50% by 2040. Shell's investment in the project is in line with its commitment to sustainable and efficient energy solutions.