Page 7 - AsiaElec Week 41

AsiaElec COMMENTARY AsiaElec
the two countries that would also connect a number of other south and Central Asian countries.
ADNOC moves
The move is indicative of Abu Dhabi’s overseas intentions. A deal was announced in late July for Abu Dhabi national Oil Co. (ADNOC) to col- laborate with Indonesia’s Pertamina throughout the value chain, and with talks apparently pro- gressing alongside Saudi counterpart Aramco to build a $60bn refining and petrochemicals mega complex in India, the Emirati firm is clearly on the front foot.
2019 has been a busy year for ADNOC at home too, with the company making eye-catch- ing divestment moves in the downstream.
In January, Italy’s EnI and Austria-based, Abu Dhabi state-affiliated OMV signed share purchase agreements to acquire interests of 20% and 15% respectively in ADNOC Refineries for a combined total of around $5.8bn after the deduction of year-end 2018 net debt. ADNOC retains 65%.
The deal, which values business at around $19.4bn, is scheduled to close in the third quar- ter and covers the 837,000 barrel per day Ruwais refining complex in the Western Region and an ageing 85,000 bpd facility near Abu Dhabi City, as well as a 1,900-km pipeline network.
The trio also agreed to establish a physical and derivatives trading JV incorporated at Abu Dhabi Global
Markets for exports of the refineries’ prod- ucts, which account for around 70% of output, with the rest deployed domestically.
Pipeline push
Meanwhile, US private equity giants have also recently moved to invest in Abu Dhabi’s oil sec- tor. In February, Blackstone and KKR acquired a 40% stake for $4bn in ADNOC Oil Pipelines. The newly-formed venture has been assigned long-term leases for 18 of ADNOC’s domestic crude oil and condensate pipelines.
In common with and before Aramco, the Emirati oil company has also been opening up to new sources of finance over the past two years. It issued an international bond through the Abu Dhabi Crude Oil Pipeline Co. (ADCOP) sub- sidiary, staged an IPO in retail unit ADNOC Distribution, and sold minority stakes in its ADNOC Refining and ADNOC Drilling arms.
In July, Blackstone and KKR were joined in the pipeline JV by and the Abu Dhabi Retire- ment Pensions and Benefits Fund (ADRPBF) and Singapore’s sovereign wealth fund GIC, with the latter acquiring a 6% stake for $600mn.
ADNOC’s attention has now turned to gas, with Bloomberg reporting this week that the company is looking for potential buyers for a share in its gas pipeline network. Reports sug- gested that the sale could bring in up to $5bn for ADNOC and information on the assets has been circulated to potential bidders.
Bloomberg said that the proposed deal could value the network at more than $15bn including debt, though the stakes acquired would take the form of a lease arrangement rather than a direct equity holding.
Keen to build on the already significant momentum, ADNOC anticipates reaching a deal by mid-2020.™
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