ADNOC Secures $11 Billion Financing for Hail & Ghasha Project
Financing Highlights
The Abu Dhabi National Oil Company (ADNOC) and its partners have successfully secured a structured financing transaction of up to AED40.4 billion (approximately US$11 billion). This initiative is aimed at monetizing the midstream future gas production of the Hail and Ghasha project.
The Ghasha concession, strategically located offshore Abu Dhabi, is projected to produce 1.8 billion standard cubic feet per day (bscfd) of gas. The financing arrangement is notable for its non-recourse nature, marking a significant achievement for an energy project of this scale and complexity. It allows ADNOC to realize upfront value for its gas production at competitive rates.
Innovative Financing Structure
In addition to granting immediate access to essential capital, the financing structure introduces an innovative commercial model that effectively isolates midstream facilities and operations. This strategic approach not only empowers ADNOC and its partners, Eni S.p.A. and PTT Exploration and Production Public Company Limited, to raise low-cost funding, but it also enables them to maintain strategic and operational control over the assets.
Dr. Sultan Ahmed Al Jaber, Minister of Industry and Advanced Technology and ADNOC Managing Director and Group CEO, emphasized the significance of the transaction: “This landmark transaction builds on ADNOC’s successful track record of global energy partnerships and unlocks capital to drive progress at Hail and Ghasha, one of the world’s most ambitious offshore gas projects.”
Capitalizing on Demand
The overwhelming interest from more than 20 leading global and regional financial institutions underscores the confidence in ADNOC’s value creation strategy and its innovative approach to financing. This funding will play a critical role in driving responsible energy production to meet the escalating demands of local industries.
Over 60% of the investment value from this project is set to flow back into the UAE’s economy. This is in alignment with ADNOC’s In-Country Value (ICV) program, which underscores the company’s commitment to ensuring a greater share of economic benefits remains within the country from the contracts it awards.
Consortium Composition
The financing transaction involves a consortium of prominent banks, including Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, and several other major financial institutions. This diverse group illustrates the collaborative effort behind securing robust funding for the Hail and Ghasha project.
ADNOC’s recent financing effort is the latest in a series of innovative infrastructure development partnerships executed over the past decade. This includes previous notable projects, such as the AED18 billion (US$4.9 billion) oil pipeline partnership and a gas pipeline agreement valued at AED37.1 billion (US$10.1 billion), demonstrating ADNOC’s ability to attract leading global investors.
Pioneering Energy Solutions
ADNOC has also ventured into pioneering BOOT (build-own-operate-transfer) projects. These projects focus on crucial areas such as a USD $3.8 billion (AED14 billion) initiative aimed at powering and decarbonizing offshore operations, as well as a USD $2.2 billion (AED8.3 billion) project designed to provide sustainable water supplies to onshore operations.
The Hail and Ghasha project is particularly noteworthy as it will be the world’s first gas development targeted at achieving net-zero emissions. This ambitious endeavor will capture 1.5 million tonnes of carbon dioxide per year, which is equivalent to eliminating the emissions produced by over 300,000 fuel-powered vehicles annually. Furthermore, the project aims to implement fully unmanned offshore operations, highlighting its commitment to innovation and sustainability.
Conclusion
ADNOC’s successful financing for the Hail and Ghasha gas project reflects both its strategic vision and operational excellence. With significant investments supporting the local economy and advancing sustainability goals, this initiative stands as a testament to ADNOC’s role in shaping the energy landscape of the UAE.
Published on 1766189193 • Category: News
