Adnoc supercharges gas output to fuel data centres

Abu Dhabi National Oil Company (Adnoc) is accelerating its gas expansion plans as the UAE braces for a sharp rise in energy demand fuelled by a rapid build-out of artificial intelligence and data centre infrastructure.

The UAE’s largest energy company plans to more than double its liquefied natural gas (LNG) production capacity to meet accelerating domestic and international consumption, Youssef Salem, chief financial officer of Adnoc Drilling, told AGBI. 

The move comes as the UAE races to expand its computing power, including its capacity to produce AI tokens – the data units processed by AI models that demand huge amounts of energy. Omar Al Olama, the minister of AI, said at the Milken Middle East and Africa Summit in Abu Dhabi last week that the country plans to generate 60 trillion of them, or about 60 percent of projected global output, through its large-scale Stargate data centre.

“This creates a massive demand for additional data centre capacity, the majority of which is gas-powered,” Salem said.

Modern hyperscale data centres consume staggering volumes of electricity. Most new data centres in the Gulf rely on gas-fired generation due to reliability, cost and availability, analysts say.

Data centres already account for 1 to 2 percent of global electricity demand, comparable to the airline industry’s energy use, according to the Massachusetts Institute of Technology. The rapid growth of generative AI is expected to push that share significantly higher.

UAE gas consumption could rise 50 percent within five years, the Khaleej Times reported, with the wider region needing an estimated $200 billion in natural gas investment by 2030.

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“The UAE plays [a role] across the entire value chain of AI: from infrastructure to large language models to applications to the gas and energy powering it,” Salem said.

Adnoc aims to leverage its low-cost production base to supply the massive volumes of energy required for AI expansion, while also deploying advanced technology internally to boost operational efficiency. 

Salem also said the company has invested in AI-enabled rigs: “In Adnoc, the strategy is energy for AI and AI for energy,” Salem said.