Adnoc Logistics & Services (Adnoc L&S) has laid out its expansion plan for group shipping needs, saying over 25 vessels will be added to its fleet during the next five years.
The shipping arm of Abu Dhabi National Oil Company (Adnoc) said the ships will include crude carriers, gas tankers and bulkers to enable more of its parent’s energy and commodities sales on a delivery basis.
Those ships will be obtained via direct purchases or charter deals, according to Adnoc L&S.
The initial plan is to acquire three VLCCs or VLGCs within this year.
“We have set out an ambitious five-year strategy for growth which defines our intent to meet the Adnoc and the United Arab Emirates’ present and future requirements, while pursuing opportunities in fast growing global markets,” Adnoc L&S chief executive Abdulkareem Al Masabi said.
State-run Adnoc plans to increase its crude production capacity to four million barrels per day (bpd) by the end of 2020 and five million bpd by 2030.
The company has a contract to supply one million tonnes of LPG per year to China’s Wanhua Petrochemical for 10 years, and the two has signed a Memorandum of Understanding to explore the creation of a joint venture for gas shipping.
In addition, ADNOC is targeting to triple its production of petrochemicals to 14.4 million tonnes per year and double its crude refining capacity by 2025.
It also expects to expand its sulphur output over the next decade.
“The ability to serve greater volumes is of significant importance. The delivery of Adnoc Group’s 2030 smart growth strategy will result in a substantial increase in the company’s production of crude oil, refined products and petrochemicals,” Al Masabi said.
“Combined with Adnoc’s move into trading, which means it will take greater control over the delivery of its products to customers and end users, Adnoc L&S is expected to grow and diversify in order to meet the ever complex and evolving needs of the industry.”
In 2016, Adnoc merged group firms Abu Dhabi National Tanker Co, Petroleum Services Co and Abu Dhabi Petroleum Ports Operating Co to create Adnoc L&S, integrating its shipping, offshore and port services operations.
The company has claimed better operating efficiency and capability to deal with shipping cyclicality since the full integration was completed in 2018.
, Adnoc L&S has a fleet of 123 ships, including 28 merchant vessels, 43 offshore supply vessels, as well as some other types of support boats.
“We have set out a clear growth strategy for Adnoc L&S and defined our intent to meet the Group’s present and future shipping and marine services requirements,” Adnoc’s chief executive Sultan Ahmed Al Jaber said.
“Adnoc L&S is a crucial link in the Adnoc supply chain, delivering oil, gas and petroleum products to our customers across the world. As we grow our trading business and strengthen our integrated maritime capabilities, we will capitalise on market growth opportunities and position the company as the largest regional integrated maritime services company.”
