November 28, 2024 [Reuters]- United Arab Emirates state oil group ADNOC on Wednesday announced the launch of XRG, an investment company focusing on lower-carbon energy and chemicals, valued at more than $80 billion.
The company, which aims to more than double its asset value in the next decade, will initially focus on “transformational” global investments when it begins operating in the first quarter of 2025, its parent Abu Dhabi National Oil Company said in a statement.
It will seek to boost its value by taking advantage of “the transformation of energy, exponential growth of AI, and the rise of emerging economies,” the statement said.
ADNOC has done a string of acquisitions in gas and chemicals, which along with LNG and renewables it considers pillars for its future growth.
Earlier this month, German plastics and chemicals maker Covestro said its management and supervisory boards supported ADNOC’s $16.3 billion takeover offer.
The Covestro deal is one of the largest foreign takeovers by a Gulf state as countries in the region seek to reduce their dependence on oil amid the global switch to cleaner energy.
XRG was announced following an ADNOC board meeting, chaired by UAE President Sheikh Mohammed bin Zayed Al Nahyan. The company was created to accelerate ADNOC’s international growth and drive greater value, a separate ADNOC statement said.
XRG’s global chemicals business aims to be among the world’s top five, expecting a 70% rise in global demand for chemical and specialty products by 2050, the statement said.
XRG’s international gas business will seek an integrated portfolio to help to meet a projected 15% rise in natural gas demand in the next decade and 65% increase in demand for liquefied natural gas by 2050.
ADNOC’s board on Wednesday also approved directing 200 billion dirhams ($54.45 billion) to the local economy over the next five years as part of the oil company’s in-country value programme.
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