(Bloomberg) – The biggest oil producer in the United Arab Emirates secured $11 billion in funding tied to future gas production from fields offshore in Abu Dhabi.
Abu Dhabi National Oil Co. and its peers are ramping up output of both oil and gas, even as analysts warn of looming supply gluts. Adnoc, however, says long-term demand for the fuels remains robust and will require significant investment.
The Hail and Ghasha projects are expected to produce about 1.8 Bscf/d when they come online by the end of this decade. The financing was arranged along with partners including Italy’s Eni SpA and Thailand’s PTT Exploration & Production Pcl, according to a statement on Thursday.
The financing was arranged by more than a dozen banks, including Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank and Agricultural Bank of China. Citigroup Inc., Standard Chartered Plc and the UAE’s largest lenders First Abu Dhabi Bank and Emirates NBD also participated in the financing package.
ADNOC last month announced a five-year, $150 billion capital-expenditure budget, in line with its previous spending plan. Much of that will go to boosting crude-output capacity to 5 MMbpd by 2027, an increase of about 25% since the expansion began. The company is also accelerating spending on natural gas as the UAE aims to become self-sufficient by the end of the decade.
ADNOC now holds an 80% stake in the Ghasha gas concession after former partner Lukoil PJSC transferred its 10% share in November, according to a spokesperson.
The U.S. has threatened to sanction companies that do business with Lukoil because of Russia’s continued war in Ukraine, prompting the Russian firm to shed overseas assets. ADNOC is among the companies interested in acquiring all or part of Lukoil’s international portfolio, Bloomberg has reported.
