The Abu Dhabi National Oil Company (ADNOC) has signed two new strategic equity partnerships with Eni and OMV that cover both ADNOC Refining and a new trading joint venture between the three partners
The proceeds to ADNOC from the sale are estimated to be US$5.8bn.
Eni and OMV will acquire 20 per cent and 15 per cent of the shares in ADNOC Refining, with ADNOC owning the remaining 65 per cent.
The agreement values ADNOC Refining, which has a total refining capacity of 922,000 bpd, and which operates the fourth largest single site refinery in the world, at an enterprise value of US$19.3bn.
Under this agreement, the partners will also establish a trading joint venture in which Eni and OMV will own 20 per cent and 15 per cent of the shares respectively.
The oil company stated that the new trading joint venture will be an international exporter of ADNOC Refining’s products, with export volumes equivalent to approximately 70 per cent of its output. Domestic supply within the UAE will continue to be managed by ADNOC, it added.
Dr Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO, said, “These innovative partnerships will support our ambition of becoming an international downstream leader with the flexibility to respond quickly to shifting market needs and dynamics. They will help enable our objective of unlocking even more value from every barrel of oil we produce.”
Claudio Descalzi, CEO of Eni, noted, “This transaction, which allows us to enter the United Arab Emirates’ downstream sector and represents a 35 per cent increase in Eni’s global refining capacity, is in line with our announced strategy to make Eni’s overall portfolio more geographically diversified, more balanced along the value chain, more efficient and more resilient to cope with market volatility.”
Dr Rainer Seele, chairman of the OMV Executive Board and CEO, commented, “With the acquisition of a share in ADNOC Refining and the creation of a global trading joint venture, OMV has established a strong integrated position in Abu Dhabi along the oil value chain, spanning from upstream production to refining & trading and petrochemicals.”
Under the terms of the agreements, ADNOC, Eni and OMV’s trading joint venture will be incorporated into Abu Dhabi Global Markets. Physical and derivative trading will probably start as early as 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 joint venture, enabling ADNOC and its partners to optimise their systems and better manage their international product flows.
