H.H. Sheikh Theyab updated on ADNOC L&S strategy to become a global shipping champion
His Highness Sheikh Theyab bin Mohamed bin Zayed Al Nahyan, a member of Abu Dhabi’s Executive Council and Supreme Petroleum Council and Chairman of the Abu Dhabi Department of Transport was updated on ADNOC Logistics & Services’ (ADNOC L&S) strategic growth plans, which will transform it into a global shipping champion, during a recent visit to Abu Dhabi’s Khalifa Port. ADNOC L&S is the maritime and logistics arm of the Abu Dhabi National Oil Company (ADNOC), the Company press release said.
During the visit, H.H. Sheikh Theyab heard how ADNOC’s ambitious growth plan will create a more competitive and diverse offering, to leverage market expansion while strengthening its role by transforming into a fully integrated marketer and trader of its products, enabled by its shipping arm ADNOC L&S. ADNOC L&S plans to acquire its first crude oil tankers, while expanding its gas and dry bulk fleet, by adding more than 25 vessels within the next five years.
This will enable ADNOC to sell more of its commodities on a ‘delivered basis’, increasing its global reach, unlocking new market opportunities and stretching the value of its supply chain.
H.H. Sheikh Theyab was received by His Excellency Dr. Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC CEO and Captain Abdulkareem Al Masabi, ADNOC L&S CEO and key personnel from the 3,400-strong organization. Also present were prominent leaders from the UAE’s energy and maritime sector.
H.H. Sheikh Theyab said ADNOC has the unwavering support of the UAE’s leadership. He praised the contribution of ADNOC to the country’s economy and prosperity, saying it plays a central role in helping the leadership’s ambitious social and economic development objectives. He commended ADNOC’s unwavering focus on its strategic growth goals, while driving operational efficiencies and enhancing its performance across the full hydrocarbons value chain.
H.E. Dr Al Jaber said: “It was an honor to welcome His Highness Sheikh Theyab to Khalifa Port and to inform him of our plans to create greater value from our ADNOC L&S assets and operations. We have set out a clear growth strategy for ADNOC L&S and defined our intent to meet the Group’s present and future shipping and marine services requirements. At the same time, there will be a focus on ADNOC’s trading ambitions, which foresee a significant growth in the delivery of products to our global customers.
“ADNOC Logistics & Services is a crucial link in the ADNOC supply chain, delivering oil, gas and petroleum products to our customers across the world. As we grow our trading business and strengthen our integrated maritime capabilities, we will capitalize on market growth opportunities and position the company as the largest regional integrated maritime services company.”
ADNOC L&S was formed in late 2016 from three ADNOC subsidiaries, ADNATCO, IRSHAD and ESNAAD. The integration created synergies between shipping, marine services, offshore logistics and onshore services, thereby enhancing organizational capabilities. Following the integration, ADNOC L&S has successfully increased revenue by 34 per cent. Overall, the company’s net operating profit has risen 220 per cent since the integration.
ADNOC L&S’s overall business model creates value through four major activities: firstly, shipping activities, either with its own vessels or via chartering, which includes crude and refined products, dry bulk, and LNG transport. Secondly, marine services activities, which comprise petroleum ports operations, diving and oil spill response. Thirdly, offshore logistics activities that include offshore support vessels and an integrated logistics base. Fourthly, onshore activities which consist of a marine passenger terminal and a container terminal.
ADNOC L&S will play a critical role in supporting the delivery of ADNOC’s 2030 smart growth strategy, through which ADNOC will increase its oil production capacity to 4 million barrels per day (mmbpd) by the end of 2020 and 5mmbpd by 2030. In the Downstream, ADNOC intends to triple production of petrochemicals to 14.4 million tons per annum and double its crude refining capacity by 2025. This ambitious growth plan, combined with ADNOC’s move into trading, presents significant opportunities for ADNOC L&S.
During the visit to Port Khalifa, H.H. Sheikh Theyab inaugurated the latest addition to ADNOC L&S’s shipping fleet. The acquisition of the 2850 TEU large feeder vessel, Al Reem 1, brings ADNOC L&S’s fleet to 123 vessels.
H.H also witnessed the signing of a Memorandum of Understanding between ADNOC L&S and China’s Wanhua Petrochemical to explore the creation of a joint venture to pave the way for the transport of greater gas volumes in line with market demand. Wanhua Petrochemical is an existing customer of ADNOC, having signed 10-year LPG purchase contract for 1MMPTA.
About ADNOC
ADNOC is one of the world’s leading diversified energy and petrochemicals groups with a daily output of about 3 million barrels of oil and 10.5 billion cubic feet of natural gas. With 14 specialist subsidiary and joint venture companies, ADNOC is a primary catalyst for the UAE’s growth and diversification.
About ADNOC Logistics & Services
ADNOC Logistics & Services provides world-class shipping, maritime and logistics, serving ADNOC and international customers. ADNOC Logistics & Services is a crucial link in the ADNOC supply chain, delivering the Group’s oil, gas and petroleum products from Abu Dhabi to the world and also serving global customers. ADNOC Logistics & Services is 100% owned by ADNOC.