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ADNOC buys 6 VLCCs to support trading business, oil capacity ramp-up

Abu Dhabi National Oil Co. has purchased six Very Large Crude Carriers as the UAE’s biggest energy producer seeks to support its newly-established trading business and its plans to boost oil production capacity by 25% to 5 million b/d by 2030.

ADNOC Logistics & Services, its shipping arm, has deployed two of the VLCCs into its fleet, placed an order for three new vessels to be delivered in 2022 and 2023 and bought an existing vessel that will be delivered soon, ADNOC said in a Feb. 25 statement. The six vessels, the first crude carriers to join the ADNOC L&S fleet, can carry a total of 12 million barrels. ADNOC didn’t disclose the value of the purchase. ADNOC L&S, which grew its fleet with 16 deep-sea vessels in 2020, also said in the statement that it ordered five newbuild and one recent second-hand Dual Fuel Very Large Gas Carriers (VLGCs) for AW Shipping, its JV with Wanhua Chemical Group. It also said it purchased four bulk carriers (3 Ultramax and 1 Handysize).

“ADNOC L&S, which is currently the largest integrated maritime logistics and shipping company in the GCC, and owner and operator of the largest shipping fleet in the UAE, is pursuing a major fleet expansion program,” ADNOC said in the statement. “This will enable the company to provide better service to its global customers, while also supporting ADNOC as it expands its production and refining capacity and grows its new trading operations.”

ADNOC plans to spend $122 billion between 2021 and 2025 on growth projects that include boosting its oil production capacity to 5 million b/d by 2030 from over 4 million b/d now.

Trading units
It is also beefing up its trading and marketing operations with the start of two units last year.

ADNOC Trading, a new unit focused on trading of crude oil, started operations in September. ADNOC Global Trading, a joint venture with OMV and Eni, began operations in December and will focus on trading of refined products.

“The acquisition of these six VLCCs is one of our most significant growth steps to date,” Abdulkareem al-Masabi, CEO of ADNOC L&S, said in the statement. “This strategic move allows us to offer new services to our customers and supports ADNOC and its trading entities to access new global energy markets, while also delivering incremental value and a new revenue stream to our business.”

ADNOC L&S bought the new and existing vessels at “competitive prices” and the purchase will help the company transport bigger volumes to its global customers.

ADNOC L&S’ international trading fleet transports crude oil, refined products, dry bulk, containerized cargo, LPG and LNG on its owned and chartered vessels.
Source: Platts

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