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ADNOC raising over USD1.1 blln from drilling unit IPO

September 28/2021

MOSCOW (MRC) -- The Abu Dhabi National Oil Company (ADNOC) has completed the book-building process for the initial public offering of its drilling unit, raising more than USD1.1 billion in the company's second flotation of a subsidiary, reported S&P Global.

Now ADNOC is selling 11% of ADNOC Drilling, which is expected to be listed on the Abu Dhabi Securities Exchange on Oct. 3, it said in a Sept. 27 statement. ADNOC initially had intended to sell a 7.5% stake in its drilling unit.
Following the listing, ADNOC will own 84% of ADNOC Drilling and Baker Hughes will retain the 5% stake it bought in the unit in 2018. Helmerich & Payne will own 1% through its IPO investment that was announced on Sept. 8.

ADNOC Drilling, which currently has 96 rigs, will acquire eight more for USD86.5 million from Helmerich & Payne, ADNOC said in a Sept. 8 statement. After the transaction, Helmerich & Payne will invest USD100 million in ADNOC Drilling's IPO.

This will be ADNOC's second flotation of a unit after it sold 10% of fuel retailer ADNOC Distribution on the Abu Dhabi exchange in 2017, raising USD851 million.

Last year, ADNOC raised USD1 billion from institutional placement of another 10% of shares of ADNOC Distribution, with the parent company retaining an 80% shareholding in the unit.

Since 2019, ADNOC has been monetizing its oil and gas assets as it seeks to unlock cash to fund strategic projects, which include increasing oil output capacity to 5 million b/d by 2030, from around the current 4 million b/d.

In June 2020, ADNOC inked a deal worth more than USD10 billion with a group of investors to sell a 49% stake in its gas pipelines a year after striking a similar transaction for its oil pipelines.

As MRC wrote before, in August 2021, ADNOC partnered with Fertiglobe for the sale of blue ammonia to Idemitsu in Japan, for use in its refining and petrochemicals operations.

We remind that in June 2021, Indian refining giant Reliance Industries signed an agreement with ADNOC to build a multi-billion-dollar chemical project in Ruwais, marking the groups first investment in a greenfield overseas project.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,396,960 tonnes in January-July 2021, up by 7% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 841,990 tonnes in the first seven months of 2021, up by 29% year on year. Supply of propylene homopolymers (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of statistical copolymers of propylene (PP random copolymers) subsided.
Author:Margaret Volkova
Tags:PP, PE, crude and gaz condensate, propylene, ethylene, petrochemistry, ADNOC, Idemitsu, Reliance Industries, India, United Arab Emirates (UAE), Japan.
Category:General News
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