Febraury 23, 2017 [OPIS] - Vitol, the world's largest independent energy trader, said that it has signed a contract with Abu Dhabi National Oil Company (ADNOC) to buy up to 528,000 tons per year of liquefied petroleum gas over the next 10 years.
This LPG agreement “creates long-term value and will help protect ADNOC from energy market fluctuations,” Vitol said.
OPIS notes that Middle East LPG exports compete with the growing U.S. LPG exports for global market share, especially in Asia and Europe.
The long-term agreement, backdated to Jan. 1, 2017 and which will expire on Dec. 31 2026, was signed on the sidelines of International Petroleum Week (IP WEEK), taking place in London, by Abdulla Salem Al Dhaheri, ADNOC’s 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 maximize 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 b/d of crude oil and products and 10 million tons of LPG annually. Revenues in 2015 were $168 billion.
Vitol’s energy assets globally include over 15.5 million cubic meters of storage across six continents; 390,000 b/d of refining capacity and Shell-branded downstream businesses in 16 African countries, as well as Australia. Vitol also has the only independent refinery in Fujairah.
Vitol’s customers include national oil companies, multinationals, leading industrial and chemical companies and the world’s largest airlines.
ADNOC is a major diversified group of energy and petrochemical companies that produces 3.1 million bbl of oil and 9.6 Bcf of raw gas per day. Its integrated upstream, midstream and downstream activities are carried out by 16 specialist subsidiary and joint-venture companies.
