Abu Dhabi National Oil Company (Adnoc) is targeting a valuation of more than $50 billion for its newly merged company Adnoc Gas, already one of the largest gas processing and marketing players in the Middle East.
Adnoc is expected to launch an initial public offering for the integrated gas company within weeks, in what could be one of the largest offerings on a United Arab Emirates bourse this year, sources close to the development told Upstream.
The Abu Dhabi giant is eyeing a valuation of at least $50 billion for Adnoc Gas, according to a report by Reuters, but with deliberations still continuing, the valuation could go even higher, Upstream understands.
Minority stake sale
Adnoc has said it will retain control of Adnoc Gas but intends to offer minority shareholdings through an IPO planned for the Abu Dhabi Securities Exchange (ADX) later this year.
HSBC and First Abu Dhabi Bank are working on the flotation, local news reports have suggested, but Adnoc has not yet clarified how much equity will be up for sale.
“The company will make a further announcement in relation to the intended IPO in due course,” it said in an earlier statement.
Adnoc Gas was created on 1 January, combining Adnoc LNG and Adnoc Gas Processing.
The consolidation of Adnoc’s gas processing and liquefied natural gas operations is expected to create one of the world’s largest gas processing entities, with capacity of about 10 billion cubic feet per day of gas across eight sites, both onshore and offshore, and a pipeline network of over 3250 kilometres, according to Adnoc.
“As Adnoc grows its gas production and processing capacity, the combined scale and capabilities of Adnoc Gas will maximise value and create new opportunities for Adnoc, its partners [and the UAE],” Adnoc said in a recent statement.
Adnoc said the consolidation of its gas processing and marketing business into Adnoc Gas, is intended to serve a wider range of domestic and international customers with an expanding portfolio of gas products.
“The new company will be more agile, better able to respond to changing market demands and well-positioned to take advantage of strategic opportunities for future growth,” it noted.
Adnoc group chief executive Sultan Ahmed Al-Jaber previously said formation of the new company “represents another major milestone in unlocking the full value of the UAE’s vast natural gas resources”.
“Natural gas will be a critical fuel in the energy transition and Adnoc Gas, through its world-scale operations and significant growth and expansion plans, will be well-positioned to meet both local and international gas demand,” he added.
Adnoc LNG includes among its partners Japan’s Mitsui & Co, UK supermajor BP and French giant TotalEnergies; while Adnoc Gas Processing comprises UK supermajor Shell, TotalEnergies and Thailand’s PTTEP.
Adnoc is building the 10 million tonnes per annum Fujairah liquefaction project and aims to emerge as a long-term exporter of LNG, while also achieving domestic self-sufficiency in natural gas.
It is also spending billions of dollars on developing the complex Hail & Ghasha sour gas fields, which could add to up to 1.5 Bcfd of gas production in the coming years.
Adnoc declined to comment on an Upstream query regarding the IPO process.