LNG

ADNOC’s finance arm, XRG will raise its stake in Rio Grande LNG project by buying another 7.6% stake in Trains 4 and 5 from the BlackRock affiliate Global Infrastructure Partners (GIP). The acquisition adds to XRG’s existing 11.7% interest in the project's first three Trains.

GasLog Ltd, the Greek LNG shipping company, has announced executive changes at the top with the decision of Chief Executive Paul Wogan to retire from his position on March 9, 2022.

“He will remain, in an advisory role until June 30, 2022 to ensure a smooth transition,” said GasLog.

The GasLog board named Paolo Enoizi, currently Chief Operating Officer of GasLog Ltd and CEO of US affiliate GasLog Partners LP. As the new CEO of GasLog Ltd, effective March 10, 2022.

GasLog is currently expanding its fleet and has ordered four newbuild 174,000 cubic metres capacity vessels for delivery in 2024 and 2025.

GasLog Ltd ordered the vessels from South Korea shipyard Daewoo Shipbuilding and Marine Engineering.

The four newbuilds will have latest generation M-type Electronically Controlled, Gas Injection (MEGI) propulsion system.

GasLog completed a merger in June 2021 with BlackRock’s Global Energy and Power Infrastructure division and de-listed its common shares from the New York Stock Exchange.

Structure

GasLog’s ownership structure has three main shareholders in both companies, parent GasLog Ltd and subsidiary GasLog Partners LP.

They are the Greek Livanos family with 55 percent, the Monaco-based Onassis Foundation with 12 percent and BlackRock’s Global Energy and Power infrastructure fund (GEPIF), holder of 45 percent of the equity.

GasLog Ltd, whose Chairman remains Peter G. Livanos, has an LNG fleet comprising 20 vessels, 12 dual-fuel, seven tri-fuel, diesel electric (TFDE) and one steam-turbine carrier.

Subsidiary GasLog Partners LP owns 15 LNG carriers, including 10 tri-fuel-diesel-electric (TFDE) ships and five steam-turbine vessels.

The GasLog business has undergone a substantial overhaul in recent years to improve efficiency and to reduce overheads.

This followed its decision in November 2019 to move its headquarters from Monaco to the Greek port of Piraeus, home of its operational platform.

Teekay LNG Partners reported a jump in net income in the third quarter as the shipping company prepared for a December vote on a deal worth $6.2 billion to become the latest LNG fleet to be taken over by, or merged with, US equity fund interests.

Teekay LNG Partners has become the latest fleet owner to be targeted by a US investment fund with Stonepeak Infrastructure Partners setting up a deal worth $6.2 billion to acquire the Bermuda-based shipping line, which has a large portfolio of vessels under charter contracts and part ownership of a Middle East LNG import terminal.

GasLog Ltd, the operator of a fleet of 35 LNG carriers, has completed its merger transaction with the infrastructure unit of the giant US asset management firm BlackRock and the company has now been taken private.

Höegh LNG Holdings, the floating terminal projects company with 12 vessels and contracts for China and India, has been acquired in a takeover by Norwegian interests and a unit of US investment bank Morgan Stanley after a vote by shareholders held in Bermuda.

A Spanish equity fund, which holds a 15 percent stake in Norwegian LNG fleet owner Höegh LNG Holdings, said it planned to vote against the takeover offer led by Morgan Stanley and Höegh family interests at a meeting scheduled for March 30 at Höegh’s registered office in Bermuda.

The Abu Dhabi National Oil Company, the oil, natural gas and LNG producer, has signed a landmark midstream infrastructure partnership with two of America’s largest equity funds, BlackRock and Kohlberg, Kravis Roberts (KKR), for an initial upfront payment to Adnoc of $4 billion.

The deals were signed in Abu Dhabi by Ahmed Al Jaber, the United Arab Emirates Minister of State and Adnoc Group Chief Executive and Laurence D. Fink, BlackRock Chairman and CEO and Henry Kravis, Co-Chairman and Co-CEO of KKR.

The UAE is the oldest LNG producer in the Middle East from its Das Island plant offshore Abu Dhabi consisting of three Trains with capacity of around 5.5 million tonnes of LNG per annum.

Adnoc recently confirmed new discoveries of gas in place totaling 15 trillion cubic feet and intends to continue LNG production for 40 more years and to increase its discovered resources and oil and gas infrastructure development.

It is also embarking on multiple sour gas projects and others onshore and offshore.

As part of the Adnoc transaction with the US funds, a newly formed entity called Adnoc Oil Pipelines will lease Adnoc’s interest in 18 pipelines, transporting stabilized crude oil and condensate across Adnoc’s offshore and onshore upstream concessions for a 23-year period.

“The entity will, in turn, receive a tariff payable by Adnoc, for its share of volume of crude and condensate that flows through the pipelines, backed by minimum volume commitments,” they explained.

Funds managed by BlackRock and KKR will form a consortium to collectively hold a 40 percent interest in the entity, while Adnoc will hold the remaining 60 percent majority stake.

Sovereignty over the pipelines and management of pipeline operations remain with the UAE company.

“The transaction will result in upfront proceeds of approximately $4 billion to Adnoc and is expected to close in the third quarter of 2019, subject to customary closing conditions and all regulatory approvals,” said Adnoc and the two equity funds.

“BlackRock and KKR’s long-term investment underlines the attractiveness of Abu Dhabi and the UAE as a rapidly emerging investment destination for international capital,” they said.

“This transaction marks the first time that leading, global institutional investors have deployed capital into key midstream infrastructure assets of a national oil company in the Middle East,” they added.

In conjunction with this transaction, Adnoc said it was laying the groundwork for additional infrastructure-related investment opportunities with institutional investors.

Adnoc’s 60 percent equity stake in Adnoc Oil Pipelines will be held through Adnoc Infrastructure, a subsidiary.

“The level and sophistication of the investors that we are attracting as financial partners to invest, alongside Adnoc, in these select pipeline assets is a clear reflection of the UAE’s stable, attractive and reliable investment environment,” said Adnoc’s Al Jaber.

Commenting on the transaction, KKR’s Kravis said it could be a catalyst for further foreign investment and broader economic transformation in the UAE.

“Having long had a presence in the region, we appreciate the high quality of Adnoc as a partner and Abu Dhabi’s investor-friendly environment to enable our first direct investment in the region. With this transaction as a precedent, we believe there is substantial potential to do even more,” stated Kravis.

This transaction follows several other recent value creation initiatives including Adnoc’s debut capital markets transaction, the issuance of the Abu Dhabi Crude Oil Pipeline (Adcop) bond, the IPO of Adnoc Distribution, the recent strategic equity and commercial partnerships between Adnoc Drilling and Baker Hughes of the US as well as Adnoc Refining’s deal with Eni of Italy.

NextDecade Corp., developer of the Rio Grande LNG project in Texas and other ventures, has agreed to sell convertible preferred stock to funds managed by US equity firm BlackRock after earlier in August selling $50 million of stock to other funds.