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UAE’s Adnoc expands tanker fleet in $1.3bn deal

  • : Crude oil, Freight, Natural gas
  • 26/08/07

Abu Dhabi state-owned Adnoc's logistics arm has agreed to acquire 11 tankers for $1.3bn, expanding its crude and LPG shipping capacity as the UAE prepares for higher oil and gas exports.

The acquisitions comprise six very large crude carriers (VLCCs), each capable of carrying around 2mn bl of oil, and five very large gas carriers (VLGCs). The additions will increase Adnoc Logistics and Services' crude tanker fleet to 14 vessels and its gas fleet to 12. Nine of the vessels were acquired on the secondary market and are due for delivery this quarter, with two newbuild VLGCs acquired through a Chinese shipyard due to follow in the fourth quarter.

The VLCC acquisitions come as Adnoc prepares for higher crude exports, with the UAE targeting oil production capacity of 5mn b/d by 2027. They could give the company greater control over deliveries at a time when the US-Iran conflict has disrupted traffic through the strait of Hormuz and tightened tanker availability.

Adnoc's 1.8mn b/d Adcop pipeline running from Habshan to Fujairah has provided a partial bypass of the strait since the war began. The company plans to expand the pipeline's capacity to around 3.3mn b/d by 2027, freeing up more crude for export from Fujairah.

The latest acquisitions extend a rapid expansion of Adnoc's shipping business. Last month, Adnoc Logistics and Services ordered four LNG carriers worth about $900mn ahead of the planned 2028 start-up of Adnoc's 9.6mn t/yr Ruwais LNG export terminal. The company also added 32 tankers to its fleet through last year's $1.04bn acquisition of an 80pc stake in Navig8.


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