Yahoo Finance Big Oil Invests in Adnoc LNG Plant in Bet on Future Demand
(Bloomberg) -- Four international companies signed up to invest in Abu Dhabi National Oil Co.’s next liquefied natural gas export project on a bet that demand for the fuel will continue to climb.
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Shell Plc, TotalEnergies SE, BP Plc and Mitsui & Co. will each take a 10% stake in the Ruwais LNG plant, Adnoc said in a statement. Two of the firms will also receive shipments from the facility.
The United Arab Emirates is among countries — including neighboring Qatar — adding LNG production capacity on the expectation demand will grow even as the energy shift accelerates. State-controlled Adnoc decided to proceed with the Ruwais project last month and signed a $5.5 billion contract for its construction.
Bloomberg was first to report the four companies’ investment plans last week. Financial terms haven’t been disclosed.
The plant is slated to come online in 2028, Shell said separately. The oil major will receive 1 million tons of LNG a year from Ruwais, while Mitsui will take 600,000 tons a year, Adnoc’s statement shows. The UAE company previously signed a 600,000-ton deal with Germany’s EnBW Energie Baden-Württemberg AG.
Adnoc now has buyers lined up for 70% of the plant’s 9.6 million-ton annual production capacity, it said, without specifying whether the agreements are binding.
The firm has ambitions to expand in the global LNG market, recently signing deals to invest in similar projects in the US and Mozambique. Gas is one of several areas it’s focusing on as part of a deal-making spree.
--With assistance from Anthony Di Paola.
(Updates with deals for shipments starting in second paragraph.)
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