ADNOC L&S Signs Agreement for Second Long-term Charter of a Floating Storage Unit with AG&P as it Delivers on its Ambitious Growth Plans

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ADNOC Logistics & Services (ADNOC L&S) and Atlantic Gulf & Pacific International Holdings (AG&P), a leading downstream LNG platform and infrastructure development company have signed a charter agreement to utilize ADNOC L&S’s LNG Carrier Ish as a Floating Storage Facility (FSU). 

Under the terms of the agreement, starting Q3 2022, AG&P will use the carrier for the first LNG Import Terminal in the Philippines at Ilijan in Batangas Bay (PHLNG). The agreement, which is valid for 11 years with the option of extension by 4 years, strengthens an existing relationship between the two companies and builds on a previous agreement between the two companies to provide another FSU in India, signed in 2021. It continues ADNOC L&S’ ongoing drive to diversify its customer base and enhance revenue streams. 

The vessel is part of a fleet of eight LNG vessels operated by ADNOC L&S and is currently under contract to ADNOC LNG, a subsidiary of ADNOC. Upon the conclusion of its contract with ADNOC LNG, the Ish will be deployed to AG&P as a floating storage facility, extending the vessel’s life by at least 11 years and up to 15 years, and bolstering ADNOC L&S’ recently established FSU revenue stream, while providing PHLNG’s customers with resiliency of supply. 

Capt. Abdulkareem Al Masabi, CEO of ADNOC L&S said: “This agreement builds on our existing partnership with AG&P and demonstrates our continued focus on maximizing value from our assets. By providing AG&P with another flexible storage solution for their new LNG terminal, we are able to extend the operational life of this vessel, unlocking incremental value and new opportunities for growth.  Furthermore, as the provider of world-class shipping, offshore logistics and onshore services, we are growing our global footprint, delivering cutting-edge technology and services to our partners. Our project with AG&P in the Philippines will contribute to the economic growth of the country by leveraging the potential of clean LNG for power generation.”

The supply, operations and maintenance of the FSU will be undertaken by ADNOC L&S while the conversion of the LNG Carrier (LNGC) to FSU will be completed by AG&P subsidiary, GAS Entec. PHLNG will be the 5th FSU-based LNG import terminal in the world, after those in India, Malta, Malaysia, and Bahrain. The integrated PHLNG offshore/onshore import terminal will have an initial capacity of 5 million tonnes per annum (MTPA). 

Mr. Joseph Sigelman, Chairman & CEO, AG&P Group, said: “PHLNG will store LNG and dispatch natural gas, providing a critical, clean transition fuel for the Philippines. We are privileged to have ADNOC Logistics and Services, a foremost global leader in LNG logistics, as our partner to transition the Philippines to cleaner fuel through AG&P’s PHLNG import terminal.”

The Ish is part of ADNOC L&S’ diverse fleet of more than 200 vessels, which, when combined with its 1.5 million square meter logistics base in Abu Dhabi and its integrated logistics capabilities, make the company the region’s leading marine logistics provider. 

The Ish was built in 1995 in Japan and has a capacity of 137,315.444 cubic meters of LNG. At the time of its inauguration was one of the largest LNG vessels in the world.

Source: ADNOC

ADNOC L&S Partners with AD Ports Group to Develop a New Port at Ruwais

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ADNOC Logistics & Services (ADNOC L&S), and AD Ports Group have signed an agreement to develop a new port and logistics facility at TA’ZIZ, the chemicals production and industrial hub currently under development at Ruwais, United Arab Emirates (UAE). 

Under the terms of the agreement, ADNOC L&S and AD Ports Group will develop a liquids terminal and logistics facility to support tenants of the TA’ZIZ Industrial Chemicals Zone. The facility will be a critical part of the supply chain for feedstocks and will store and load final products for export. The partners will select an international operator to enter into a new joint venture and contribute to the development of the new port. 

Speaking at the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC), Captain Abdulkareem Al Masabi, CEO of ADNOC L&S, said: “Our strategic partnership with AD Ports Group builds on the complementary strengths of two UAE industrial champions in accelerating the competitiveness of TA’ZIZ and our growing petrochemicals sector in Ruwais. The new port will consolidate the UAE’s competitiveness as an international supply chain hub for energy and industry and further positions TA’ZIZ as the preferred partner for investing in the growth of the UAE’s advanced manufacturing base.”
TA’ZIZ is strategically aligned with the UAE’s ‘Principles of the 50’, with initial chemicals production expected in 2025. 

Captain Mohamed Juma Al Shamsi, Group CEO, AD Ports Group, said: “As an enabler of trade and industry, we remain committed to creating highly attractive business opportunities for companies within Abu Dhabi and the wider UAE. Our collaboration with ADNOC L&S to develop a port and liquid terminal facility to support TA’ZIZ is aligned with our vision of driving the growth of international trade in the Emirate. By bringing together our respective expertise to build vital trade infrastructure, we are boosting industrial investment flows to the UAE and helping accelerate Abu Dhabi’s economic growth and industrialization.”

Three large-scale berths and associated infrastructure in addition to loading and unloading facilities will make up the foundation of the new port. The two liquid berths measure 640 meters in length with the dry bulk berth measuring 320 meters, which combined equals 10 football pitches. A tank farm with ten product tanks and one feedstock storage tank will be included, with specialized utilities, control rooms, and product vapor handling systems safeguarding the products in storage.

TA’ZIZ comprises three zones; an Industrial Chemicals Zone that will host chemicals production with seven world-scale projects in the design phase, a Light Industrial Zone that will convert the outputs of the Chemicals Zone into consumable products, and an Industrial Services Zone that will house companies who provide services required by the other zones. 

Since launching in November 2020, contracts have been awarded for the initial Front-End Engineering and Design (Pre-FEED) for seven world-scale chemicals projects. Partnership announcements have been made for Blue Ammonia, Ethylene Dichloride (EDC), Chlor-alkali (CA) and Polyvinyl chloride (PVC). TAQA and ADNOC have also signed an agreement to develop a utilities facility for chemicals projects. 

ADNOC L&S is the largest integrated shipping and maritime logistics company in the Middle East, with a fleet of over 240 owned and chartered vessels and integrated solutions models covering the entire oil and gas supply in the UAE. The company operates the largest and only purpose-built oil and gas logistics base in the UAE, providing a wide range of diversified services to the offshore industry. ADNOC L&S’ recent 25-year exclusive agreement to service all Petroleum Ports in Abu Dhabi solidifies its role as the oil and gas supply chain champion in the UAE.

Source: ADNOC

ADNOC Awards Eni and PTTEP Consortium the First Offshore Exploration Block in Abu Dhabi’s Second Competitive Block Bid Round

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Italy’s Eni and Thailand’s PTTEP awarded exploration concession for Offshore Block 3 and will invest up to AED1.51 billion ($412 million) during the exploration phase

In the event of a commercial discovery, the consortium will have the right to a production concession for a term of up to 35 years

ADNOC continues to leverage and strengthen its strategic partnerships to accelerate the exploration and development of Abu Dhabi’s hydrocarbon resources

The Abu Dhabi National Oil Company (ADNOC) announced, today, the signing of an exploration concession agreement, awarding the exploration rights for Abu Dhabi’s Offshore Block 3 to a consortium led by Eni Abu Dhabi B.V., a wholly-owned subsidiary of Italy’s multinational energy company, Eni, and PTTEP MENA Ltd., a wholly-owned subsidiary of Thailand’s PTT Exploration and Production Public Company Limited (PTTEP).

The award has been approved by Abu Dhabi’s Supreme Petroleum Council (SPC). It follows ADNOC’s award earlier this month of an onshore block to Occidental, highlighting how ADNOC continues to leverage and strengthen its strategic partnerships to accelerate the exploration and development of Abu Dhabi’s hydrocarbon resources.

The exploration concession agreement was signed by His Excellency Dr. Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology and ADNOC Group CEO; Claudio Descalzi, CEO of Eni; and Phongsthorn Thavisin, CEO of PTTEP.

H.E. Dr. Al Jaber said: “This concession award reinforces ADNOC and Eni’s growing partnership across our value chain and deepens our relationship with Thailand’s PTTEP, one of the key markets for our crude oil and products. This again validates our targeted approach to value-add partnerships that contribute the right combination of capital, technology, capabilities and market access to accelerate the development of Abu Dhabi’s hydrocarbon resources.

“Despite volatile market conditions, we are making very good progress in delivering Abu Dhabi’s second competitive block bid round, underscoring our world-class resource potential and the UAE’s stable and reliable investment environment. We continue to welcome partners that share our vision to sustainably unlock value from our hydrocarbon resources for our mutual benefit, as we deliver on our 2030 strategy and enable long-term returns to the UAE.”

Under the terms of this agreement, Eni will operate the exploration phase of the concession, and PTTEP and Eni will collectively hold a 100% stake in the exploration phase, investing up to AED1.51 billion ($412 million) towards exploration and appraisal drilling, including a participation fee, to explore for and appraise oil and gas opportunities in Offshore Block 3.

This award underscores the attractiveness of Abu Dhabi’s huge untapped resource potential and ADNOC’s ability to continue to secure foreign direct investment (FDI) to the United Arab Emirates (UAE), despite the tough market environment. Offshore Block 3 offers the potential to create significant in-country value for the UAE over the lifetime of the concession.

Claudio Descalzi said: “This award follows the one achieved by the same consortium in 2019 for offshore exploration Blocks 1 and 2 and represents a further important step towards the realization of Eni’s strategy to become a leading actor in the development and production in Abu Dhabi, a leading region for the oil and gas industry, while contributing through its expertise in exploration to add further resources and exploit all potential synergies with the surrounding fields. It also further strengthen our relationship with our valuable partner PPTEP. Offshore Block 3 represents a challenging opportunity that can unlock significant value thanks to exploration and appraisal of shallow and deep reservoirs”.

Following successful commercial discovery during the exploration phase, Eni and PTTEP will, together, have the right to a production concession to develop and produce such commercial discoveries. ADNOC has the option to hold a 60% stake in the production phase of the concession. The term of the production phase is 35 years from the commencement of the exploration phase.

Phongsthorn Thavisin said: “This concession award offers another great opportunity for PTTEP to strengthen collaboration with world-class strategic partners Eni and ADNOC. The consortium will bring capabilities, experiences and technology to accelerate the development of Offshore Block 3, as well as Offshore Blocks 1 and 2, and lead to a successful discovery. The strategic partnership has been established to jointly contribute to the petroleum development in UAE and be part of the growing industry. Meanwhile, this business progress has also reinforced our presence in the Middle East following the company’s Execute and Expand strategy. Such approach aims to sustainably increase both petroleum reserves and production in the future.”

Offshore Block 3 covers an offshore area of 11,660 square kilometers northwest of Abu Dhabi city. New 3D seismic data has been acquired for a part of the block, which, combined with its proximity to the existing onshore oil and gas fields, suggests the concession area has promising potential.

In addition to drilling exploration and appraisal wells, the exploration phase will see Eni and PTTEP leverage and contribute financially and technically to ADNOC’s mega seismic survey, which is already acquiring seismic data within the block area. This world’s largest 3D seismic survey is deploying industry-leading technologies to capture high-resolution 3D images of the complex geology at ultra-deep locations below the surface and will be used to identify potential hydrocarbon reservoirs.

In January 2019, a consortium led by Eni and PTTEP was awarded two offshore blocks in Abu Dhabi’s first competitive bid round. The consortium continues to explore for oil and gas in the blocks known as Offshore 1 and Offshore 2, located northwest of Abu Dhabi city.

All exploration activities in Abu Dhabi are carefully planned to mitigate any potential impacts through the implementation of protection measures, the use of advanced techniques and technologies, and stakeholder engagement to minimize drilling activities in populated or environmentally sensitive areas.

ADNOC launched Abu Dhabi’s second competitive block bid round in 2019, offering a set of major onshore and offshore blocks, on behalf of the SPC. Based on existing data from detailed petroleum system studies, seismic surveys, exploration and appraisal wells data, estimates suggest the blocks in this second bid round hold multiple billion barrels of oil and multiple trillion cubic feet of natural gas.

This award comes about a month after the SPC announced the discovery of recoverable unconventional oil resources estimated at 22 billion stock tank barrels (STB) and an increase in conventional oil reserves of 2 billion STB which boosted the UAE’s conventional reserves to 107 billion STB.

Source: adnoc.ae

ADNOC- Petropipe

ADNOC L&S and Wanhua Chemical Group form Strategic Shipping Joint Venture

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ADNOC Logistics & Services (ADNOC L&S), the shipping and maritime logistics subsidiary of the Abu Dhabi National Oil Company (ADNOC), announced the formation of a new strategic joint venture (JV) with Wanhua Chemical Group (Wanhua). The new company named AW Shipping Limited is incorporated in Abu Dhabi Global Market (ADGM) in the United Arab Emirates (UAE). 

This strategic JV agreement further strengthens the collaboration between ADNOC and Chinese companies and builds on the deep-rooted bilateral relations between China and the UAE. The JV underscores ADNOC’s focus on value-creating deals and will support the delivery of its 2030 smart growth strategy. 

AW Shipping Limited (AW Shipping) will own and operate a fleet of very large gas carriers (VLGCs) and modern product tankers. The company will be responsible for transporting LPG cargoes and other petroleum products, sourced from the ADNOC Group and global suppliers, to Wanhua Group’s manufacturing bases in China and around the world. To deliver maximum fleet efficiency, the company may also pursue other market opportunities.

H.E. Dr. Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology and ADNOC Group CEO, said: “We are very pleased to establish this strategic joint venture with Wanhua Chemical Group. This creative win-win partnership strengthens our growing relationship and will deliver greater value and efficiency for both our organizations. Importantly, the JV further solidifies ADNOC L&S’ position as the largest, fully integrated logistics and shipping company in the UAE and paves the way for the transportation of greater LPG volumes to China, in line with market demand. 

The establishment of AW Shipping supports ADNOC’s smart growth and value creation strategy and is another example of how ADNOC is stretching the margin from every molecule that we produce, refine, ship and sell, while also forging stronger partnerships in key growth markets.” 

The formation of AW Shipping follows a 10-year liquefied petroleum gas (LPG) supply contract signed between ADNOC and Wanhua in November 2018.  

ADNOC L&S is a crucial enabler in the ADNOC value chain, delivering oil, gas, and petroleum products to customers across the world. It owns and operates the UAE’s largest shipping fleet, which it expects to grow further in the coming years as ADNOC increases its upstream and downstream production capacity, and enters into trading. 

Mr. Liao Zengtai, Chairman of Wanhua Chemical Group, said: “We are very glad that joint venture has been established with the concerted efforts of both parties. The new company will strengthen the strategic cooperation between ADNOC and Wanhua and will also ensure the stable supply of LPG cargoes and other petroleum products for Wanhua system. More importantly, the cooperation will make contribution to the “One Belt, One Road” project.”

ADNOC L&S was formed in late 2016 from three ADNOC subsidiaries, ADNATCO, IRSHAD, and ESNAAD. The integration created synergies between shipping, marine services, offshore logistics, and onshore logistics to create the largest integrated shipping and maritime logistics company in the GCC. ADNOC L&S provides safe, reliable and cost-competitive maritime and logistic solutions to ADNOC Group companies and to more than 100 global customers. 

The company creates value for its customers and partners through four major activities; firstly, shipping activities, either with its own vessels or via chartering, which includes crude and refined products, dry bulk, and LNG transport. Secondly, marine service activities which comprise petroleum port operations, diving, and oil spill response. Thirdly, offshore logistics activities that include offshore support vessels and an integrated logistics base in Mussafah, Abu Dhabi, one of the largest in the region. Finally, onshore activities which consist of a marine passenger terminal and a container terminal.

Last year, ADNOC L&S transported over 20 million metric tonnes of various oil & gas products and dry bulk commodities.

Wanhua Group is one of the world’s leading producers for methylene diphenyl diisocyanate (MDI) a key ingredient in the manufacture of high-performance adhesives and synthetic fibers, which go into a wide range of industries.

Source: ADNOC