Abu Dhabi National Oil Company (Adnoc) is reportedly building an underground oil storage bunker in the mountains in Fujairah, Reuters reported.

An anonymous source familiar with the matter told Reuters the facility is located in Mandous and will be big enough to store approximately 40 million barrels of oil. 

The development will reportedly be completed in 2020, with South Korea's SK Engineering and Construction having won the main contract for the project.

READ: New deal to boost $11bn Adnoc Drilling in oil well construction sector

SK Engineering and Construction could be reached for comment at the time of writing, and Adnoc declined to comment.

According to ProTenders, SK Engineering and Construction is working as the Adnoc oil project's engineering, procurement, and construction contractor.

Adnoc is the 12thlargest oil producer in the world and is responsible for producing up to three million barrels of oil per day.

On 8 October, the Abu Dhabi company entered an $11bn (AED40.4bn) strategic partnership with US-based oil business Baker Hughes to create a construction business that will see its subsidiary Adnoc Drilling become a fully-fledged construction operator.

As part of the agreement, the US company acquired a 5% stake in Adnoc Drilling, worth $550m (AED2bn).

READ: Arabtec subsidiary's consortium wins $871m Adnoc LNG contract

Adnoc announced a major redevelopment of Ruwais City, a 6.9km² community in Al Dhafra region, this September. 

Up to 3,000 units will be built over the next 15 years as part of the project that will double Ruwais City's population to 50,000 and create thousands of jobs as well.

The expansion of Ruwais City will support Adnoc's $44.9bn (AED165bn) strategy to expand downstream operations.