(EnergyAsia, February 28 2011, Monday) — US-based Occidental Petroleum Corp (Oxy) said it will partner the Abu Dhabi National Oil Co (ADNOC) in a US$10-billion project to jointly develop the Shah gasfield in the UAE.

Occidental said ADNOC has a 60% stake while it will hold the remaining 40% interest in a 30-year contract.

The partners will jointly develop gas gathering systems, new pipelines and trains to access and process one billion cubic feet of high-sulphur content gas. They expect to produce approximately 500 million cubic feet per day of network gas and a significant amount of condensate and natural gas liquids starting 2014.

ADNOC has already awarded engineering procurement and construction contracts to develop the field, located 180 km southwest of Abu Dhabi City.

Ray R Irani, Occidental’s chairman and CEO, said:

“We are honoured that the Abu Dhabi government has chosen Oxy to participate in this major gas project. Production at the Shah Field will be an important future resource to fill the rapidly expanding regional demand for gas.

“This is another important step in the implementation of our growth strategy and in our relationship with the emirate of Abu Dhabi. The development of this field under the agreement provides an exciting opportunity to create value for the people of Abu Dhabi and for our stockholders.”

Los Angeles, California-headquartered Occidental is the fourth largest US oil and gas company based on equity market capitalisation, with operations in North America, Middle East, North Africa and Latin America.