Abu Dhabi / WAM
President His Highness Sheikh Mohamed bin Zayed Al Nahyan, on Monday presided over the annual meeting of the Abu Dhabi National Oil Company (Adnoc) Board of Directors, in his capacity as its Chairman.
During the meeting, which was held at Adnoc Headquarters, the board directed Adnoc to pursue a “Net Zero by 2050” ambition to support the UAE Net Zero by 2050 Strategic Initiative.
The board also approved Adnoc’s strategy to accelerate growth across its value chain to responsibly meet rising energy demand and support global energy security. As part of the strategy, Adnoc will establish a new Low Carbon Solutions and International Growth vertical focused on new energies, gas, liquefied natural gas (LNG) and chemicals.
His Highness Sheikh Mohamed praised Adnoc’s steps to further reduce its carbon footprint as it expands its operations to meet rising global energy demand. His Highness also noted that Adnoc’s comprehensive approach to sustainability is a testament to the UAE’s commitment to remaining a responsible global energy provider and to enabling a more sustainable future.
President His Highness Sheikh Mohamed underlined Adnoc’s important role as a primary catalyst for the UAE’s growth and diversification and commended the company for maximising value for the nation and creating new economic and industrial opportunities for the private sector. His Highness praised Adnoc’s efforts to drive industrial growth through its In-Country Value (ICV) programme and its support for the “Make it in the Emirates” initiative.
This year, Adnoc’s ICV programme has driven over AED35 billion ($9.54 billion) back into the nation’s economy and enabled 2,000 UAE nationals to be employed in Adnoc’s supply chain. These achievements bring the total value driven back into the economy to AED140 billion ($38 billion) since the programme was launched in 2018. In addition, a total of 5,000 UAE Nationals have been employed in Adnoc’s supply chain through the programme since it was launched.
Adnoc is also supporting the “Make it in the Emirates” initiative and has signed agreements for local manufacturing opportunities worth over AED25 billion ($6.8 billion) with the UAE and international companies this year, as it delivers on its target to locally manufacture over 100 products in its procurement pipeline worth AED70 billion ($19 billion) by 2030.
HH Sheikh Mohamed lauded Adnoc’s emphasis on performance and efficiency and its efforts to develop and empower its workforce. His Highness commended Adnoc’s achievements in enhancing the productivity of employees and increasing the rate of UAE National employment by 15 percentage points compared to 2015.
His Highness expressed his appreciation for the hard work of Adnoc’s employees and stressed that people are the nation’s greatest assets and the UAE Leadership will continue to prioritise human capital development. His Highness also underscored the importance of continuing to improve performance, efficiency and agility and directed Adnoc to strengthen its efforts in this regard.
At the meeting, the board endorsed plans to bring forward Adnoc’s 5 million barrels per day (mmbopd) oil production capacity expansion to 2027, from the previous target of 2030, as part of the accelerated growth strategy. Adnoc produces some of the world’s least carbon intensive oil and this new target will provide the company with greater flexibility to meet rising global energy demand.
The accelerated production capacity target is underpinned by the UAE’s robust hydrocarbon reserves, which have increased by 2 billion stock tank barrels (STB) of oil and 1 trillion standard cubic feet (TSCF) of natural gas this year. These additional reserves increase the UAE’s reserves base to 113 billion STB of oil and 290 TSCF of natural gas, reinforcing the country’s position in global rankings as the custodian of the sixth-largest oil reserves and the seventh-largest gas reserves.
The board endorsed the creation of “Adnoc Gas”, a new world-scale gas processing and marketing company, effective January 1, 2023. The flagship company will combine the operations, maintenance and marketing of Adnoc Gas Processing and Adnoc LNG into one consolidated entity. Adnoc will proceed with an initial public offering (IPO) of a minority stake in the new company on the Abu Dhabi Securities Exchange (ADX) in 2023, subject to applicable regulatory approvals.
Adnoc’s five-year business plan and capital expenditure (Capex) of AED550 billion ($150 billion) for 2023-2027 was approved to enable the accelerated growth strategy. As part of this plan, Adnoc aims to drive AED175 billion (US$48 billion) back into the UAE economy through its ICV programme.
Other board members that attended the meeting were HH Sheikh Hazza bin Zayed Al Nahyan, Deputy Chairman of Abu Dhabi Executive Council; HH Sheikh Mansour bin Zayed Al Nahyan, Deputy Prime Minister and Minister of the Presidential Court; HH Sheikh Khaled bin Mohamed bin Zayed, Deputy National Security Adviser, Member of Abu Dhabi Executive Council and Chairman of Abu Dhabi Executive Office; Suhail bin Mohammed Al Mazrouei, Minister of Energy and Infrastructure; Dr. Sultan bin Ahmed Al Jaber, Minister of Industry and Advanced Technology and Managing Director and Group CEO of the Abu Dhabi National Oil Company (Adnoc); Ahmed Ali Al Sayegh, Minister of State; Dr. Ahmed Mubarak Ali Al Mazrouei, Chairman of the Abu Dhabi Executive Council Office; Khaldoon Khalifa Al Mubarak, Chairman of the Board of Directors of Emirates Nuclear Energy Corporation (Enec); Awaidha Murshed Al Marar, Chairman of the Abu Dhabi Department of Energy (DoE); and Jassem Mohammed Al Zaabi.
Dr. Sultan Al Jaber said, “As a result of the wise guidance and directives of the President His Highness Sheikh Mohamed bin Zayed Al Nahyan, the support of the Adnoc Board of Directors and the hard work of all my colleagues, Adnoc is well-positioned for this new phase of accelerated growth across the energy value chain. Through our Net Zero by 2050 ambition, we are placing sustainability at the centre of our growth, building on the legacy of the Founding Father, the late Sheikh Zayed bin Sultan Al Nahyan, who laid the foundation for Adnoc to become one of the least carbon intensive oil and gas producers in the world.
“The world needs maximum energy, minimum emissions, and it needs all the energy solutions if we are to ensure global energy security. Adnoc is committed to making today’s energy cleaner while investing in the clean energies of tomorrow to strengthen our position as a reliable and responsible energy provider. As we deliver on these objectives, we will continue to drive greater and more sustainable value for the UAE, create opportunities for the private sector to benefit from Adnoc’s growth and enable more skilled job opportunities for UAE Nationals.”
Adnoc’s Net Zero by 2050 ambition covers its operational Scope 1 and Scope 2 greenhouse gas emissions (GHG). This ambition is underpinned by a continued focus on key decarbonisation levers of energy efficiency and operational excellence across the value chain, large scale implementation of carbon capture, utilisation and storage (CCUS) and the use of renewable energy sources.
Adnoc is an industry leader in efficiently reducing methane emissions, and it is making significant investments in new technologies to further improve its environmental performance. The company recently set a new upstream methane intensity target of 0.15% by 2025. Adnoc is also leveraging its partnerships to invest in and integrate low-carbon technologies and solutions to ensure a cost-effective decarbonisation pathway.
The Low Carbon Solutions and International Growth vertical will build on Adnoc’s successful value creation and investment journey and further drive international growth, as well as capture opportunities in renewables and new energies.
Upstream, the increase in oil and gas national reserves was driven by deploying advanced technologies, applying best reservoir management practices and optimising field development plans. Most of the 2 billion STB oil national reserves are Murban-grade crude, reinforcing the long-term liquidity of the Murban Futures Contract, which has been trading on the ICE Futures Abu Dhabi (IFAD) commodities exchange since March 2021.
Downstream, the formation of Adnoc Gas builds on Adnoc’s more than 40 years’ experience as a leading gas producer. The consolidation of Adnoc’s gas processing and LNG operations will create one of the world’s largest gas processing entities with a processing capacity of around 10 billion standard cubic feet per day (scfd) of gas across eight sites, both onshore and offshore, and a pipeline network of over 3,250 kilometres.