02/25/2021 | Press release | Distributed by Public on 02/25/2021 04:54
Two VLCCs added to fleet in 2020 with three newbuilds placed on order and one existing vessel recently purchased
Project Management and Design work for newbuild vessels to be undertaken in the UAE, contributing to In-Country Value
Expansion supports ADNOC's growth in Trading and opens new revenue streams for ADNOC L&S
Abu Dhabi, UAE - February 25, 2021: ADNOC Logistics & Services (ADNOC L&S), the shipping and maritime logistics arm of Abu Dhabi National Oil Company (ADNOC), today announced the acquisition of six Very Large Crude Carriers (VLCCs). Two VLCCs have already been deployed into the company's fleet. ADNOC L&S has placed an order for three newbuild vessels with options, which will be delivered in 2022 and 2023, and purchased one additional existing vessel that will be joining its fleet shortly. These vessels are the first crude carriers to join the ADNOC L&S fleet, adding a total cargo capacity of 12 million barrels.
ADNOC L&S, which is currently the largest integrated maritime logistics and shipping company in the GCC, and owner and operator of the largest shipping fleet in the UAE, is pursuing a major fleet expansion program. This will enable the company to provide better service to its global customers, while also supporting ADNOC as it expands its production and refining capacity and grows its new trading operations. ADNOC has established two new trading companies: ADNOC Trading, which is focused on crude oil and started derivatives trading in September 2020; and ADNOC Global Trading (AGT), a joint venture with ENI and OMV that focus on trading of refined products and began operations in December 2020.
Captain Abdulkareem Al Masabi, CEO, ADNOC Logistics and Services said, 'The acquisition of these six VLCCs is one of our most significant growth steps to-date. This strategic move allows us to offer new services to our customers and supports ADNOC and its Trading entities to access new global energy markets, while also delivering incremental value and a new revenue stream to our business.'
'Given recent market conditions, we were able to purchase both existing and newbuild vessels at competitive prices. Owning these vessels will deliver cost efficiencies for our business, as opposed to chartering vessels, while also enabling us to provide a more reliable service to customers. These purchases also further reinforce our position as the largest, fully integrated logistics and shipping company in the region, paving the way for the transportation of greater crude volumes to customers across the world.'
The latest purchases by ADNOC L&S reflects the company's continued focus on modernizing, growing and diversifying its fleet. Built to ADNOC's specification, the newbuild vessels will be equipped with industry-leading Smart Ship technology. While the specialist manufacturing facilities for this type of VLCC are only available in a limited number of countries, predominantly in Asia, ADNOC L&S secured higher levels of In-Country Value (ICV) for this important contract by ensuring that Project Management and design work for the newbuild vessels is undertaken in the UAE. In addition, a team of young UAE nationals from ADNOC L&S will work closely with the design and project management teams to enhance their knowledge and experience in the design, construction and future maintenance of VLCC vessels.
The six vessels, each with a minimum length of 330 meters (1,082 feet), will have a 300,000 metric tonnes deadweight and the ability to carry nearly two million barrels of crude oil, adding a total of 12 million barrels capacity to the ADNOC L&S fleet. Two VLCCs were delivered in December and are already operational on key ADNOC Trading routes and one additional existing vessel purchased this week will join the fleet shortly.
The establishment of a new VLCC fleet comes as ADNOC progresses its plans to grow its oil production capacity. The company currently has a capacity of over 4 mbopd, which it intends to grow to 5 mbopd by 2030.
ADNOC L&S grew its fleet with 16 deep-sea vessels in 2020. In addition to its new VLCC fleet, the company confirmed the order of five newbuild and one recent second-hand Dual Fuel Very Large Gas Carriers (VLGCs) for AW Shipping, its Joint Venture with Wanhua Chemical Group, and recently announced the purchase of four bulk carriers (3 Ultramax and 1 Handysize).
These orders add to ADNOC L&S's fleet of 120 owned vessels, which includes deep-sea shipping, offshore support and marine services vessels. The ADNOC L&S international trading fleet transports crude oil, refined products, dry bulk, containerized cargo, LPG and LNG on its owned and chartered vessels, supporting ADNOC's operations locally and facilitating the shipment of commodities to global markets.