Friday, 5 July 2024

ADNOC's Ruwais LNG to earmark 40% stake to Shell, Total, BP, Mitsui, sources say | Reuters

ADNOC's Ruwais LNG to earmark 40% stake to Shell, Total, BP, Mitsui, sources say | Reuters

Abu Dhabi National Oil Company (ADNOC) has earmarked a 40% stake in its Ruwais liquefied natural gas (LNG) project to four energy majors Shell (SHEL.L), opens new tab, TotalEnergies (TTEF.PA), opens new tab, BP (BP.L), opens new tab, and Japan's Mitsui (8031.T), opens new tab, sources told Reuters.

The four companies are expected to get a stake of 10% each in the project which will more than double UAE's output of the sea-borne fuel and is expected to produce about 9.6 million metric tons per annum (mtpa) by late 2028, the sources said.

One source said ADNOC plans to assign another 5% stake to another partner, without giving details.

ADNOC has also allocated 2 mtpa to shareholders, another source said, speaking like others on condition of anonymity Due to sensitivity of the talks.

The companies are expected to get the offtake at a lower price compared to the market, but with less flexibility, the source said.

ADNOC, Shell and BP and TotalEnergies declined to comment. Mitsui did not immediately respond to request for comment.

The project, which has received final investment decision for in June, is expected to be key for Shell and TotalEnergie's Middle East-Asia LNG trade.

The state oil giant has big ambitions in gas and LNG, which along with renewable energy and petrochemicals it sees as pillars for its future growth. It currently produces around 6 mtpa of LNG and aims to lift its capacity to 15 mtpa.

As demand for natural gas spiked following Russia's invasion of Ukraine, several Gulf countries have looked to capitalise. Qatar this year announced a further expansion of its North Field project that will cement it as one of the world's top LNG exporters.

ADNOC has already signed supply deals with Germany's EnBW and Securing Energy for Europe (SEFE), as well as China's ENN Natural Gas.

The project is expected to be the region's first LNG export facility to run on clean power.

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