Abu Dhabi National Oil Company (Adnoc) is set to combine two of its key gas subsidiaries, Adnoc LNG and Adnoc Gas Processing, creating one of the largest gas processing and marketing companies in the region.

The state-owned giant confirmed the development on Monday and said the merged entity, dubbed Adnoc Gas, will come into effect from 1 January 2023.

“The flagship company will combine the operations, maintenance and marketing of Adnoc Gas Processing and Adnoc LNG into one consolidated entity,” the company said.

The merger will proceed with an initial public offering of a minority stake in the new company on the Abu Dhabi Securities Exchange (ADX) in 2023, “subject to applicable regulatory approvals”.

The company has been consolidating its business verticals and listing some of its key subsidiaries, raising money for its strategic businesses.

It has listed its subsidiary Adnoc Drilling on the ADX and is said to be exploring an IPO for Adnoc L&S, Upstream understands.

Leading producer

The company said that the formation of Adnoc Gas “builds on Adnoc’s more than 40 years of experience as a leading gas producer”.

“The consolidation of Adnoc’s gas processing and LNG operations will create one of the world’s largest gas processing entities with a capacity of around 10 billion cubic feet per day of gas across eight sites, both onshore and offshore, and a pipeline network of over 3250 kilometres,” it added.

Adnoc said the existing Adnoc LNG and Adnoc Gas Processing joint ventures will receive operations and maintenance services from Adnoc Gas.

Adnoc LNG involves Japan’s Mitsui & Co, UK supermajor BP and French giant TotalEnergies, while Adnoc Gas Processing comprises UK supermajor Shell, TotalEnergies and Thailand’s PTTEP.

“As a leading global player, Adnoc Gas will serve a wider array of domestic and international customers with an expanding portfolio of gas products and the company is expected to yield significant financial and operational benefits for Adnoc and its strategic partners,” it added.

Adnoc is building the 10 million tonnes per annum Fujairah liquefaction terminal and aims to emerge as a long-term exporter of LNG, while also achieving domestic self-sufficiency of natural gas in the country.

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.

Stay a step ahead with the Upstream News app
Read high quality news and insight on the oil and gas business and its energy transition on-the-go. The News app offers you more control over your Upstream reading experience than any other platform.