Dubai: The Abu Dhabi utility giant TAQA has decided to retain most of its oil and gas assets after a strategic review was held recently to decide the company’s strategy for this particular portfolio. What will be sold are the upstream assets Taqa has in the Netherlands, and discussions are ongoing.
The decision factors in ‘macro-economic changes that have occurred during the last 12 months and which are expected to continue for some time’, TAQA said. There are also ‘other asset-specific drivers’. The oil and gas sector has been recording record prices driven by demand and supply-side constraints. These had a telling effect on TAQA’s recent financials as well.
“We concluded that retaining the vast majority of the portfolio will deliver the best value for the company and its stakeholders,” said Jasim Husain Thabet, Group CEO and Managing Director of TAQA. “This is in part evidenced by the strong contribution – over 15 per cent - that the oil and gas business contributed to our revenue and earnings in 2021. That trend has continued into this year.”
Deciding to let go of the Netherlands’ assets is based on the relatively small contribution they make to group earnings.
“We have conducted an extensive review of our oil and gas portfolio, including reaching out to the market to explore the potential for disposal,” the CEO said. “Our strategy remains to be a champion for low carbon power and water for Abu Dhabi and beyond and to continue to improve and expand our utility businesses, with a clear focus on renewables. As such, we remain committed to becoming a net zero company by 2050.”
TAQA already owns and operates one of the largest single site solar PV plants in the world and is constructing another that will be almost twice the size and with world-leading low cost of production.
By 2030 the company's power generation portfolio will be at least 30% renewables, up from the current 5%. In addition, by 2030 the company expects to deliver around 1.1 billion imperial gallons per day of desalinated water in Abu Dhabi with two thirds coming from energy efficient reverse osmosis.