GIC now joins ADNOC, BlackRock, KKR, and ADRPBF in a new pipeline partnership called ADNOC Oil Pipelines


GIC now joins ADNOC and others as stakeholders in ADNOC Oil Pipelines (Credit: Mohammed alborum/Wikimedia Commons)

Singapore’s sovereign wealth fund GIC has completed its $600m (£486.68m) acquisition for a 6% stake in ADNOC Oil Pipelines, a new pipeline partnership created in the UAE.

GIC had entered into the deal with the UAE state-owned oil company Abu Dhabi National Oil Company (ADNOC) in late July. The Singaporean fund now joins ADNOC, BlackRock, KKR, and the Abu Dhabi Retirement Pensions and Benefits Fund (ADRPBF) in the pipeline partnership.

Focus of ADNOC Oil Pipelines

ADNOC Oil Pipelines comprises ADNOC’s stakes across 18 pipelines, which have a total length of more than 750km, and a combined capacity of around 13,000Mbblpd.

The new pipeline entity will handle transportation of stabilised crude oil and condensate across ADNOC’s offshore and onshore upstream concessions for a period of 23 years. The UAE oil and gas giant will retain sovereignty over the pipelines and will also handle the management of pipeline operations.

The new pipeline partnership will be entitled to a tariff payable by ADNOC, for its portion of volume of crude and condensate that is transported through the 18 pipelines, which are backed by minimum volume commitments.

In June, BlackRock and KKR closed their $4bn (£3.24bn) deal to acquire a combined stake of 40% in the pipeline partnership. Last month, ADRPBF completed acquisition of 3% stake in ADNOC Oil Pipelines for AED1.1bn ($240m).

The closing of all the deals takes the combined investment in ADNOC Oil Pipelines to $4.9bn (£3.97bn).

Currently, ADNOC through its subsidiary ADNOC Infrastructure holds the remaining stake of 51% in the pipeline entity. ADNOC Infrastructure also holds ADNOC’s 100% interest in the Abu Dhabi Crude Oil Pipeline (ADCOP).

ADNOC finance and investment group director Ahmed Jasim Al Zaabi said: “The successful final closing of this landmark transaction is a clear vote of confidence by the global investment community in both the UAE and ADNOC as attractive investment destinations.

“The calibre of these leading global and domestic investors underlines the quality and attractiveness of ADNOC’s infrastructure assets and our ability to efficiently structure and close value-creating investment opportunities for our partners and investors.”