VZCZCXRO0799
PP RUEHDE
DE RUEHAD #1163 1931445
ZNY CCCCC ZZH
P 121445Z JUL 07
FM AMEMBASSY ABU DHABI
TO RUEHC/SECSTATE WASHDC PRIORITY 9340
INFO RUEHLO/AMEMBASSY LONDON PRIORITY 1201
RUEHFR/AMEMBASSY PARIS PRIORITY 1013
RUEHDE/AMCONSUL DUBAI PRIORITY 7166
RHMFISS/DEPT OF ENERGY WASHINGTON DC PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC PRIORITY
RHEHNSC/NSC WASHDC PRIORITY
RHEHAAA/WHITE HOUSE WASHINGTON DC PRIORITY C O N F I D E N T I A L ABU DHABI 001163 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR NEA/ARP, EEB/ESC/IEC/EPC 
WHITE HOUSE FOR OVP 
 
E.O. 12958: DECL: 07/12/2017 
TAGS:        
SUBJECT: DOLPHIN GAS ARRIVES IN UAE & ABU DHABI CONSIDERS 
FUTURE OIL CONCESSIONS 
 
REF: A. ABU DHABI 1021 
 
      B. ABU DHABI 539 
      C. 06 ABU DHABI 4325 
 
Classified By: Ambassador Michele J. Sison for reasons 1.4 (b & d). 
 
 1. (SBU) Dolphin Energy announced on July 10 that it was now 
sending natural gas from its production wells in Qatar's 
North field to the UAE.  According to the press release, 
Dolphin Energy is now processing the gas at its "dedicated 
gas processing plant in Qatar's Ras Laffan Industrial City - 
then transporting the refined methane by sub sea export 
pipeline" to Abu Dhabi. Occidental Development President Rolf 
Monjo told Econchief that Dolphin would increase to full 
production of two billion cubic feet per day as quickly as 
the engineers allow.  We have previously heard that Dolphin 
hopes to be fully operational by first quarter 2008. 
 
 2. (C) Hamed Hurr Al-Suwaidi, Abu Dhabi Finance Department 
Undersecretary and member of Abu Dhabi's Supreme Petroleum 
Council (SPC) told Econchief on July 8 that the SPC and the 
Abu Dhabi National Oil Company (ADNOC) were planning for the 
2014 expiration of the Abu Dhabi Company for Onshore Oil 
Operations (ADCO) concession.  He said that ADNOC was 
currently planning to break up the concession into smaller 
blocks.  This would allow IOC's operate their own blocs in 
partnership with ADNOC, which Al-Suwaidi speculated, could 
address some companies' concerns.  Currently competitors such 
as ExxonMobil and BP are also partners in ADCO, and Exxon has 
expressed some concerns about having its proprietary 
technology leak to its partners/competitors.  ADNOC Deputy 
CEO Abdulla Nasser Al-Suwaidi had previously told Econchief 
that breaking up the concession would also allow more IOC's 
the opportunity to partner with ADNOC. 
 
 3. (C) Comment:  The long-awaited Dolphin launch should help 
alleviate some of the UAE's near term gas needs, assuming 
that it grows to full capacity on schedule.  ADNOC had been 
blending 600 million cubic feet of its own gas with "early 
gas" from Qatar Petroleum that Dolphin had been transporting 
to Dubai.  ADNOC had planned to stop providing this gas this 
summer once Dolphin began providing its own gas, which would 
enable it to provide more gas to Abu Dhabi's own power needs 
(ref b).  In the longer term, however, rapid UAE growth is 
expected to drive demand higher than what Dolphin can meet. 
The upcoming expiration of the ADCO concession will 
complicate ADNOC plans to increase oil production capacity as 
IOC partners weigh significant capital investments against 
the relatively short remaining life of the concession.  End 
Comment. 
SISON