DUBAI: Abu Dhabi National Oil Co (ADNOC) said on Wednesday it will acquire a stake in VTTI, a Vitol-backed global energy
DUBAI: Abu Dhabi National Oil Co (ADNOC) said on Wednesday it will acquire a stake in VTTI, a Vitol-backed global energy storage company, as part of the state-run UAE energy firm's transformation drive and its expansion into oil trading.
ADNOC will acquire a 10% stake in VTTI, allowing it to secure storage in global export markets as well as at the port of Fujairah, a regional bunkering and storage hub in the United Arab Emirates.
Under the deal both Vitol and IFM Global Infrastructure Fund, an investment vehicle managed by IFM Investors, will each own a 45% stake in VTTI.
VTTI owns 15 terminals located at major hubs across 14 countries - including the Netherlands, the United States, Asia and Africa - and its storage network holds about 60 million barrels of combined storage capacity.
The deal "will further complement the development of ADNOC's integrated global trading platform, while also delivering a solid financial return," ADNOC Chief Executive Sultan al-Jaber said in a statement.
ADNOC has 8 million barrels of storage in Fujairah and is also building the world's largest single underground project for oil storage there, with a capacity of 42 million barrels of crude oil.
The Abu Dhabi Crude Oil Pipeline, with a capacity of 1.5 million bpd, carries the bulk of the UAE's crude production to ADNOC's storage and loading facilities in Fujairah, bypassing the often-troublesome Strait of Hormuz, which is further north.
The state-run oil and gas producer, long seen as one of the most conservative energy companies in the Gulf region, has embarked in the past couple of years on a major transformation to become more proactive and adaptive to market changes.
Since then, ADNOC has expanded its business, striking supply and exploration deals with international oil companies, listing one of its firms, issuing global bonds and loans and creating strategic partnerships with oil majors and financial players.