A reservoir containing an estimated 80 trillion cubic feet of shallow gas, and spanning around 5,000 square kilometres, was discovered on Monday, UAE authorities reported.
The reserve, located between Abu Dhabi and Dubai, is the fourth largest in the world, and the first major natural gas discovery in 15 years, since Galkynysh field was found in Turkmenistan in 2005.
The Jebel Ali project is the first-time state-owned Abu Dhabi National Oil Co (Adnoc) has sought new fuel reserves in Dubai, making the discovery after drilling more than ten wells.
On Sunday, Adnoc signed an agreement to develop the supply jointly with the Dubai Supply Authority (Dusup), which plans to use a variety of standard and unconventional drilling techniques to pump out the fuel.
In recent months, the UAE has announced smaller gas finds including "Mahani", discovered by Sharjah National Oil Corporation and its Italian partner Eni, marking the first onshore discovery in the emirate since the early 1980s.
While in November, Adnoc announced the discovery of seven billion barrels of oil, 58 trillion cubic feet of conventional gas, and 160 trillion cubic feet of unconventional gas in Abu Dhabi.
The UAE has the seventh largest gas supply in the world and produces approximately four per cent of global oil. Yet, despite large gas reserves and production, the country relies on imports from Qatar, and has been seeking new sources to become diversify, energy secure and self-sufficient by 2030.
President of the Dubai Civil Aviation Authority, Sheikh Ahmed Bin Saeed Al Maktoum, said on Twitter that "this will combine our capabilities to diversify energy resources, ensure greater energy security and maintain economic growth for our long-term prosperity".
Today, the Dubai Supply Authority signed a joint venture agreement with ADNOC to develop a new gas reservoir in Jebel Ali. This will combine our capabilities to diversify energy resources, ensure greater energy security and maintain economic growth for our long-term prosperity. pic.twitter.com/4FPfggWw2f
— HH Sheikh Ahmed bin Saeed Al Maktoum (@HHAhmedBinSaeed) February 3, 2020
Chief Economist of Abu Dhabi Commercial Bank, Monica Malik, told Gulf News: "The economic impact of this discovery will largely depend on how quickly commercial production can begin."
The Jebel Ali reserve contains shallow gas, which refers to organic gas found just beneath the earth's surface. The nature of the gas means the cost of the production is much lower than that for reaching deeper resources.
A reason Malik is certain that the gas will "have a positive long-term impact on the economy".