UAE’s ADNOC Gas boosts capex to $15bn on booming LNG market

UAE’s ADNOC Gas raised its capital expenditures to $15bn over the next five years from about $13bn earlier, as the company forecasts strong demand for liquefied natural gas (LNG) through the rest of the decade.

The energy firm is expanding processing capacity at home by taking control of a coastal LNG plant from ADNOC Group, its parent company, once construction is completed. ADNOC Gas plans to acquire the group’s 60 per cent stake in the Ruwais LNG plant in the second half of 2028 for about $5bn.

“Over the next five years, we plan to invest $15bn in CAPEX in projects which will enable us to capture opportunities from the forecast increase in domestic and global demand for the lower carbon gases we produce,” said Dr Ahmed Mohamed Alebri, the CEO of ADNOC Gas.

“This investment is a central component of our ambitious international growth plans and will strengthen our position as a powerhouse in the global LNG market.”

ADNOC is building the multibillion-dollar Ruwais LNG project and has taken stakes in export facilities in the US and Africa, while ADNOC Gas is managing the construction and design of the plant as well as the marketing of the fuel volumes.

The Ruwais LNG plant will more than double ADNOC’s current 6 mtpa LNG capacity to over 15 mtpa, leveraging artificial intelligence (AI) and other innovative technologies to enhance safety, minimise emissions and drive efficiency.

The facility, currently under development in Abu Dhabi, is set to be the first LNG export facility in the Middle East and North Africa region to run on clean power. When completed, it is expected to consist of two 4.8 million mtpa LNG liquefaction trains with a total capacity of 9.6 mtpa.

ADNOC Gas LNG supply deals

To date, more than seven mtpa of Ruwais LNG project’s production capacity has been committed to international customers through long-term agreements.

ADNOC has big ambitions in gas and LNG, which, along with renewable energy and petrochemicals, it sees as pillars for its future growth. It currently produces around six mtpa of LNG and aims to lift its capacity to 15 mtpa.

The energy firm already has existing LNG supply deals with Germany’s EnBW, Japan Petroleum Exploration Company, TotalEnergies Gas and Power, and India Oil Corporation.

Earlier in July, a consortium of global energy companies acquired a combined 40 per cent stake in the Ruwais LNG project, as the global demand for natural gas is expected to surge by more than 50 per cent by 2040.

bp, Mitsui & Co., Shell and TotalEnergies will each take a 10 per cent stake in the Ruwais LNG plant. ADNOC also signed multi-year LNG supply agreements with Shell and Mitsui to deliver 1 mtpa and 6 mtpa, respectively.

ADNOC Gas’ Q3 net income rose by 11 per cent year-on-year (YoY) to reach $1.24bn, topping analysts’ expectations, while its revenues climbed 8 per cent YoY to $6.3bn, marking the fourth consecutive quarter above the $6bn threshold.

Read: UAE’s ADNOC agrees multi-year LNG supply deal with SEFE