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DUBAI – The United Arab Emirates’ national energy company plans to sell about 4 percent of its natural gas business in an initial public offering, hoping to raise $2 billion, as the Middle East petrostate ramps up plans to supply Europe.
Abu Dhabi National Oil Company (Adnoc) will sell more than 3 billion shares in Adnoc Gas, one of the world’s largest gas processing entities, on the Abu Dhabi Stock Exchange on February 23. Shares are expected to begin trading on March 13.
Adnoc Gas was formed earlier this year after Adnoc merged its liquefied natural gas and gas processing units as part of a push to boost LNG production and trade.Abu Dhabi recently delivered its first LNG shipment to Germany as Europe is increasingly turning to the Middle East After avoiding Russia, its main gas supplier, for invading Ukraine.
In the long term, Abu Dhabi sees natural gas as an important part of its future energy mix with renewables and nuclear power.
“Gas is at the heart of the energy transition,” said Khaled Al Zaabi, Adnoc Agency Group Chief Financial Officer.
If the IPO raises more than $2 billion, it could be Abu Dhabi’s largest on record, according to people familiar with the matter. Following the offering, Adnoc will own about 91 percent, while ADNOC, or Taqa, will own about 5 percent.
IPOs are up to date The latest wave of big listings Both countries across the Gulf, led by Saudi Arabia and the United Arab Emirates, are aggressively taking advantage of high energy prices to take state-owned companies public and raise cash, which also helps diversify their energy-dependent economies.
Adnoc has taken several of its subsidiaries public over the past few years, including its petrochemical companies Borouge and Adnoc Drilling. Borouge raised more than $2 billion in its initial public offering last year.
Adnoc Gas in its website Says it holds 95% of the UAE’s natural gas reserves, estimated to be the seventh-largest in the world. Adnoc Gas expects to pay $3.25 billion in dividends in 2023.
West largely shuns Russian oil and gas Moscow sanctioned for invading Ukraine, the Middle Eastern oil country now has a new market in Europe after years of focusing on sales in Asia. Abu Dhabi sees Europe as the market of the future as geopolitics is changing and all Russian energy imports will be replaced by mid-2024 at the earliest.
Earlier this week, Adnoc made its first LNG delivery from the Middle East to Germany.adnock too Negotiating to acquire a commodity trading company Gunvor Group Ltd. will become one of the world’s largest traders of oil and gas products, according to people familiar with the matter.
Adnoc announced last year that it had found as much as 2 trillion standard cubic feet of natural gas offshore and plans to build a 9.6 million-ton-a-year liquefied natural gas plant in the emirate of Fujairah in the eastern United Arab Emirates. The facility will boost Adnoc’s LNG capacity to 15.6 million tonnes per annum by 2028, making it a potential rival to neighboring Qatar, one of the world’s largest LNG exporters.
Qatar has emerged as one of Europe’s best hopes for weaning itself off Russia’s gas reliance following the outbreak of the Ukraine war. Germany, France, Belgium and Italy have been in talks with Qatar over long-term purchases of LNG. The Gulf state is pursuing a multibillion-dollar plan to boost its natural gas production capacity by 40% to 110 million metric tons a year by 2026.
Tankers carrying liquefied natural gas float off European coasts, waiting for fuel prices to rise. The Wall Street Journal’s Joe Wallace explains how tankers are Europe’s attempt to solve energy shortages, and what it could mean for the continent this winter. Caption: Alexander Hotz/WSJ
Write to Summer Said summer.said@wsj.com
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