The Abu Dhabi National Oil Company (ADNOC) today announced a strategic investment in global storage terminal owner and operator VTTI BV (VTTI).
VTTI is an independent global owner of 15 hydrocarbon storage terminals across 14 different countries. The company's storage network holds around 60 million barrels (9.5 million m3) of combined storage capacity, much of which is in locations that are complementary to ADNOC’s trade flows.
As part of this agreement, ADNOC will acquire a 10 per cent equity stake in VTTI. Following the transaction, VTTI will be owned 10 per cent by ADNOC, 45 per cent by IFM Global Infrastructure Fund (IFM GIF), an investment vehicle managed by IFM Investors, and 45 per cent by Vitol (both directly and through Vitol Investment Partnership II Ltd, an investment vehicle sponsored and managed by Vitol).
The investment in VTTI provides ADNOC access to storage capabilities across some of its key export markets such as Asia, Africa and Europe while also securing additional facilities at the port of Fujairah, UAE, its main storage hub. This transaction also significantly contributes to the development and growth of ADNOC’s global marketing, supply and trading platforms, providing greater access to knowledge and capabilities that will further enable ADNOC’s growth plans.
H.E. Dr. Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO, said: “We are delighted to be entering into this strategic investment opportunity in VTTI, alongside Vitol and IFM GIF, which will further complement the development of ADNOC’s integrated global trading platform while also delivering a solid financial return. VTTI’s diverse portfolio of storage assets across key target markets such as Asia, Africa and Europe, provides us with direct access to our customers around the world, a key building block to accelerating ADNOC’s transformation into a more integrated and commercially-minded global energy player.”
He added: “As one of Fujairah’s largest storage operators, VTTI is a natural partner for ADNOC. This investment further strengthens ADNOC’s strategic position in Fujairah and supports the continued development of Fujairah as a strategic hub for our operations.”
By expanding its international storage capabilities and reach, ADNOC will move closer to its customers, allowing it to be more agile and respond quickly to market needs and dynamics. It will also unlock incremental revenue, margin and cost saving opportunities from the trading, transportation and storage of its products, giving ADNOC better control over where, when and how its products are being supplied to key markets and customers.
Rob Nijst, CEO VTTI said: “This exciting development is testament to the professionalism and dedication of our VTTI colleagues. Since VTTI was founded 13 years ago, we have worked tirelessly to build a market-leading hydrocarbon storage company, capable of delivering the highest standards of service in key strategic locations. We are very pleased to have ADNOC as our new shareholder and look forward to benefiting from their regional expertise, working together to further grow our global network of terminals and supporting ADNOC’s trading and supply ambitions.”