Abu Dhabi National Oil Company said it would proceed with the $6.2 billion development of an offshore gas project in the United Arab Emirates, increasing its bet that long-term gas demand will remain strong despite conflict in the Middle East highlighting supply vulnerabilities.

State-run Adnoc said Tuesday that it had taken the final investment decision on the Umm Shaif Gas Cap project alongside France's TotalEnergies, Italy's Eni and the China National Petroleum Corporation. The site is the Adnoc's longest-operating offshore field.

A gas cap is the accumulation of gas that sits above the oil column in a reservoir. The project is set to unlock more than 600 million standard cubic feet a day of natural gas and associated gas liquids, Adnoc said. That is equivalent to almost 10% of the U.A.E.'s current daily gas consumption. Production is expected to start by 2030.

Adnoc is betting on a major expansion in its natural gas and liquefied natural gas portfolio, with the strategy based on expectations that domestic and international demand for gas will continue to rise as energy-hungry data centers proliferate and populations in Asia continue to grow.

The investment also reflects the U.A.E.'s domestic and international priorities. The country is aiming for self-sufficiency in natural gas while its decision this year to leave the Organization of the Petroleum Exporting Countries was seen as a statement of intent to become a more established energy power, giving it more freedom to decide how much oil it produces.

However, the decision comes amid a conflict in the region that is threatening to escalate again, with Iran exchanging fire with the U.S. and its Gulf allies in recent days.

In the early stages of the conflict, Iran's barrage of missile attacks on countries in the region hit key energy infrastructure, including in the U.A.E. Meanwhile, the closure of the key Strait of Hormuz chokepoint left oil and gas unable to reach consumers, triggering a global scramble for alternative supply.

Adnoc is also to develop the Bab Gas Cap, which should unlock an additional 1.5 billion standard cubic feet a day of natural gas and associated gas liquids. The group has also launched a global LNG marketing and trading platform.

Write to Adam Whittaker at adam.whittaker@wsj.com

(END) Dow Jones Newswires

July 21, 2026 07:15 ET (11:15 GMT)

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