Adnoc eyes new era of growth with partnerships

It is a reformist move in tune with the changing times. As the oil prices remain suppressed at sub $50 levels, only a progressive approach would allow businesses to stay afloat and flourish. The decision of the Abu Dhabi National Oil Company (Adnoc) to create new joint ventures and float minority stakes in some of its services businesses is, therefore, a welcome move. The oil behemoth, which is the 12th largest oil producer in the world, is propelling a new era of growth for itself and the emirates on the whole. It will create a regional drilling company, a new energy infrastructure venture and open up its refinery and petrochemical operations to outside investors. The plan is bold, one that will not only raise billions of dollars, but also create more value for the company through reinvestment and more jobs. Naturally so, it is endorsed by the leaders of the country. His Highness Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, tweeted: Adnoc’s initiative will expand strategic partnership opportunities, deliver strong financial returns and support the UAE’s future growth.

Adnoc latest announcement is also in line with the company’s 2030 strategy, a bolder vision to evolve the company as a modern world-class player in the industry. Much of the credit goes to Sultan Al Jaber, Group CEO of Adnoc, who has ushered seismic changes in the company to make it more efficient. “We want to make sure that our revenues are not dependent only on what the market price [of crude] is ... That is why we are aggressively pursuing more gas, more refining and more petrochemicals,” Jaber had said in an interview in January. The drop in oil prices since late 2014 has nudged many oil companies to find new ways of shoring up non-oil revenues. There’s a renewed impetus for reform and Adnoc is taking the lead in this regard. It has played a key role in the oil and gas sector and growth of the UAE, and will continue to do so with new partnerships.