Business & Finance Club Magazine - Oil & Gas Sector - Abu Dhabi: Abu Dhabi's state-controlled oil producer is seeking engineering and construction bids to build a sulphur granulation plant at the Shah natural gas development as the capital looks to boost its fuel supply.

The company aims to award a contract in the fourth quarter, two people with knowledge of the bidding process said. Abu Dhabi National Oil Co., the state oil and gas producer known as Adnoc, invited 18 construction firms to bid for the project and is seeking offers this month, one of them said.

Abu Dhabi is developing its sour, or high-sulphur, gas reserves as domestic power consumption soars, and has already awarded most construction contracts related to the project.

Sour gas is more expensive to produce because potentially lethal sulphur must be separated and processed for sale.

Middle Eastern oil producers like the UAE and Kuwait have been forced to import gas as the need for fuel exceeds domestic supply. Abu Dhabi imports gas from Qatar and is developing nuclear reactors to meet energy demand, which is expected to double by 2020, according to government studies.

Adnoc aims to start production at Shah by the second or third quarter of 2014.

The producer last month said Abu Dhabi Gas Development Co., its operating unit for the project, awarded almost $5.6 billion (Dh21 billion) in engineering and construction contracts for the Shah deposit.

Saipem, Europe's biggest provider of oilfield services by market value, won about $3.5 billion in contracts for gas processing and sulphur recovery at the field, Adnoc said.

Samsung Engineering Co. won a separate contract for $1.5 billion to build utilities and off site facilities and a group made up of Tecnicas Reunidas and Punj Lloyd Ltd. won a contract to build gas-gathering facilities.

Al Jaber Group has already built roads to the desert site under the first work contract awarded.

Adnoc aims to turn the sulphur into solid form and ship the element by rail to the Abu Dhabi coast where it can be loaded on to ships and sold for use as a building material or in fertilisers.

The company abandoned a plan to build a 250-kilometre pipeline to transport liquid sulphur to the coast after deeming the technology too demanding and costly.