Shell has announced that it is to exit the joint development of the Bab sour gas reservoirs with Adnoc in Abu Dhabi.
It said in a statement this afternoon: “Following a careful and thorough evaluation of technical challenges and costs, Shell has decided to exit the joint development of the Bab sour gas reservoirs with Adnoc in the emirate of Abu Dhabi, and to stop further joint work on the project.”
It added: “The evaluation concluded that for Shell, the development of the project does not fit with the company’s strategy, particularly in the economic climate prevailing in the energy industry.”
UAE Minster of Energy Suhail Al Mazroui said on Monday that the UAE was not worried about Shell’s pullout from the project.
“The reason most probably will be (a) commercial reason because now the cost of gas and the price of gas and LNG has dropped more than 50 per cent,” he said on the sidelines of a conference in Abu Dhabi.
“We are not worried about supply of gas. We are planning well, if the company is pulling out I’m not worried,” Mr Al Mazroui said.
More to follow.
Follow The National’s Business section on Twitter