ADNOC completes strategic partnership deals with Eni and OMV

Agreement that was first announced in January of this year includes one of the world’s largest-ever refinery transactions

Abu Dhabi National Oil Company (ADNOC) has finalised its strategic equity partnership deal with oil and gas firms Eni and OMV. The agreements cover the existing ADNOC Refining business and a new trading joint venture (JV).

As per the terms of the deal, Eni and OMV have acquired 20% and 15% shares respectively in ADNOC Refining. The latter refines in excess of 922,000 barrels per day of crude and condensate at its Ruwais and Abu Dhabi based refineries. The transaction is said to reflect the scale, quality, and growth potential of ADNOC’s Refining’s assets.

ADNOC says Ruwais is the fourth biggest single-site refinery in the world. The firm has plans for further expansion and integration in a bid to develop the world’s largest single-site refining and petrochemicals complex. As a zero heavy fuel oil capable refining business, it is said to be ideally positioned for IMO 2020 (the new regulatory cap on sulphur emissions for marine fuel). Expanding refining and petrochemical operations at Ruwais supports ADNOC in its move to become a leading global downstream player, the statement said.

ADNOC, Eni and OMV have now also incorporated a new trading JV known as ADNOC Global Trading at the Abu Dhabi Global Market. The JV will focus on direct sales of products from the refinery to customers in Asia and emerging markets.

This will enable the entity to capture trading value throughout the entire supply chain. ADNOC says it is building out its trading activity and capabilities in order to better optimise and commercialise its assets and product flows to deliver greater value.

As per the statement, physical and derivative trading is expected to begin in 2020 when all necessary processes, procedures, and systems are in place. Eni and OMV will provide ADNOC with know-how, operational experience and support to accelerate the development of the trading JV. This will allow ADNOC and its partners to optimise their systems and better manage their international product flows. The partners hold the same shareholding in the trading JV as in ADNOC Refining.

ADNOC says the strategic partnerships with Eni and OMV are examples of its group-wide transformation and value creation strategy in response to an evolving energy landscape. The move will ensure the firm remains a resilient and flexible company that can take full advantage of market opportunities, the company noted.

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