ADNOC L&S to spend up to Dh9.2 billion on new LNG carriers

Dubai: ADNOC Logistics and Services will be spending up to Dh9.2 billion ($2.5 billion) for new-generation LNG carriers as part of the company's 'transformational growth strategy'. South Korean shipyards Samsung Heavy Industries and Hanwha Ocean have picked up the contracts for the construction of the carriers.

Each of the Korean companies will build four LNG vessels and with the option for an additional one. These are expected to be delivered beginning of 2028 and will be 'time chartered' to ADNOC Group subsidiaries for a period of 20 years. These will be in support of the growing exports of natural gas as 'an in-demand critical lower-carbon transitional fuel'.

The new vessels will increase ADNOC L&S's fleet of LNG Carriers from 14 to at least 22 vessels. “The shipbuilding contracts with Samsung Heavy Industries and Hanwha Ocean are major steps forward in our transformational growth strategy," said Capt. Abdulkareem Al Masabi, CEO of ADNOC L&S.

ADNOC L&S has now committed over 50 per cent of its $5 billion plus medium-term strategic investment target a year after its IPO. During the stock listing process, ADNOC L&S had highlighted its 'transformational' growth strategy, targeting investments of $4 billion to $5 billion over the medium term. This would be to capitalize on 'high-probability, value-accretive' opportunities.

The ADNOC company recently revised its growth guidance upwards, whereby it now intends to invest over $5 billion in energy-related maritime logistics to meet growing demand in and beyond the UAE.

“These (new) LNG Carriers will employ cutting-edge technology to increase fuel efficiencies and carbon intensity reductions in line with the company’s sustainability goals and will open up new opportunities for customer and geographical expansion while unlocking increased value for our shareholders," said Al Masabi.