Agreement creates long-term value and will help protect ADNOC from energy market fluctuations
Abu Dhabi, UAE – February 22, 2017: The Abu Dhabi National Oil Company (ADNOC) has signed an agreement with Vitol, the world’s largest independent energy trader, for the sale of up to 528,000 tonnes per year of LPG, to Vitol, over the next 10 years.
The long-term agreement, backdated to January 1, 2017 and which will expire on the 31st of December 2026, was signed on the side-lines of International Petroleum Week (IP WEEK), taking place in London, by Abdulla Salem Al Dhaheri, ADNOC Sales and Marketing Director and Russell Hardy, a member of Vitol’s Executive Committee.
Al Dhaheri said: “ADNOC has implemented a new strategy toward its LPG sales by negotiating longer term contracts to cope with the oversupply market especially after the Shale Gas Revolution.
“This agreement, which strengthens the long-standing relationship between ADNOC and Vitol, is a prime example of the innovative and different thinking we are bringing to our business deals. It will create reliable, long-term value and maximise our gas resources to ensure the company is resilient to future fluctuations in the global energy markets.”
Vitol is a private company founded in Rotterdam in 1966. It has over 40 offices worldwide and its largest operations are in Geneva, Houston, London and Singapore. Its primary business is the trading and distribution of energy products globally including over 6 million bpd of crude oil and products and 10 million tonnes of LPG annually. Revenues in 2015 were $168 billion.
Hardy said: 'We are delighted to be working with ADNOC on this long-term supply agreement. LPG is an important clean fuel and this will support our growing downstream LPG business.”
Vitol’s energy assets globally include over 15.5 million cubic metres of storage across six continents; 390,000 bpd of refining capacity and Shell-branded downstream businesses in 16 African countries, as well as Australia. Vitol also has the only independent, long-standing refinery in Fujairah. Vitol’s customers include national oil companies, multinationals, leading industrial and chemical companies and the world’s largest airlines.