Abu Dhabi National Oil Company Forms $20.7B Gas Venture in Region

UTC by Teuta Franjkovic · 3 min read
Abu Dhabi National Oil Company Forms $20.7B Gas Venture in Region
Photo: Depositphotos

The Abu Dhabi National Oil Company said it attracted significant capital from Global Infrastructure Partners, Brookfield Asset Management, GIC, Ontario Teachers’ Pension Plan Board, NH Investment & Securities and Snam.

Abu Dhabi National Oil Company (ADNOC) said on Tuesday it went into a $20.7 billion partnership with a group of six global investors in order to buy a 49% stake in a newly-made venture, ADNOC Gas Pipeline Assets, with lease rights to 38 pipelines.

As part of this partnership, the group will provide $10.1 billion to acquire the newly-formed venture. ADNOC will be an owner of the majority stake of 51% and will maintain ownership of the gas pipes. It will also conduct all operations and will be held liable for all capital expenses.

Biggest Gas Venture in the World This Year

For now, as per the Abu Dhabi National Oil Company, this venture represents the single-largest energy infrastructure investment in this region, and also, the biggest in the world made this year. The project is also a vital part of the UAE national oil company’s approach to bring foreign investments and optimize its assets’ worth.

The six companies mentioned to form a partnership are an infrastructure investment fund Global Infrastructure Partners, the alternative asset management company Brookfield Asset Management, Singapore’s sovereign wealth fund GIC, Ontario Teachers’ Pension Plan Board, NH Investment & Securities and an Italian energy infrastructure company Snam.

Sultan al-Jaber, chief executive officer of ADNOC Group and UAE’s minister of state said:

“We are excited to have completed this deal, and once again partner with some of the word’s leading infrastructure and institutional investors. It is in fact a huge achievement, particularly given the current challenging economic climate and business environment, and it is, if anything, a testament to Abu Dhabi and the UAE’s position as a trusted, reliable and credible investment destination.”

Al-Jaber added this partnership will enable ADNOC to reinstate effectively and finance businesses that give better results and higher profit.

Al-Jaber also mentioned there may be some hints that the oil market is narrowing, mostly because of the OPEC+ production cuts and the restoration of demand around the globe. Also, due to the economies’ reopening, this might also have an impact.

He added:

“To me, the journey to the next normal may not be a straight line. But I believe we are on the right track and on the right path for recovery.”

Succes of Energy Alliance Depends on All Members

However, we shouldn’t forget to mention that earlier this month OPEC kingpin Saudi Arabia and non-OPEC leader Russia were saying success of the energy alliance’s latest production cuts relies on all members complying with the terms of the deal.

We also should mention that just before that OPEC+ agreed to boost its deepest round of production cuts in history to have approximately 10% of oil supplies of the market through to the end of next month.

Oil prices have rallied in recent weeks, with the West Texas Intermediate crude crossing the $40 a barrel for the first time since March. At the time of writing the price was $41.55. At 6:42 am ET, the price of Brent went up by 1.88% to $43.79.

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Teuta Franjkovic

Experienced creative professional focusing on financial and political analysis, editing daily newspapers and news sites, economical and political journalism, consulting, PR and Marketing. Teuta’s passion is to create new opportunities and bring people together.

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