ADNOC strengthens UAE-India energy ties with 15-year LNG deal with IndianOil

The Abu Dhabi National Oil Company (ADNOC) has entered into a significant 15-year agreement with Indian Oil Corporation Ltd (IndianOil) for the supply of 1 million metric tonnes per annum (mmtpa) of liquefied natural gas (LNG). This agreement positions IndianOil as ADNOC’s largest LNG customer by 2029, with a total offtake of 2.2 mmtpa. This deal is part of ADNOC’s strategic efforts to enhance its global LNG footprint and strengthen energy ties between the United Arab Emirates (UAE) and India.

Expanding LNG Capacity and Supporting Clean Energy Goals

The LNG will primarily be sourced from ADNOC’s lower-carbon Ruwais LNG project, which is currently under development in Al Ruwais Industrial City, Abu Dhabi. Expected to start commercial operations in 2028, the Ruwais LNG facility will be the first in the Middle East and North Africa (MENA) region to run extensively on clean power. The project will feature two liquefaction trains with a total capacity of 9.6 mmtpa, effectively doubling ADNOC’s existing LNG production capacity to 15 mmtpa. This significant expansion is aligned with ADNOC’s broader strategy to transition towards cleaner energy solutions, emphasizing the reduction of carbon emissions in its operations.

ADNOC has already secured several long-term LNG supply agreements with global energy giants such as Shell, TotalEnergies, BP, Mitsui & Co., and Japan Petroleum Exploration Company (JAPEX), covering over 70% of the Ruwais LNG project’s production capacity. The involvement of these major players, each acquiring a 10% stake in the Ruwais LNG plant, indicates strong global confidence in the project’s potential and ADNOC’s strategic direction in the LNG sector.

Strategic Energy Partnership with India

This agreement with IndianOil is part of a broader UAE-India energy collaboration. The deal was signed during an official visit to India by the Crown Prince of Abu Dhabi, Sheikh Khaled bin Mohamed Al Nahyan, further underscoring the importance of this partnership in supporting India’s growing energy needs. Alongside this agreement, ADNOC also signed a renewed oil storage agreement with the Indian Strategic Petroleum Reserve to bolster India’s energy security.

The LNG agreement complements the Comprehensive Economic Partnership Agreement (CEPA) signed between the UAE and India in 2022, which has been pivotal in enhancing trade and economic ties between the two nations. It is expected to support India’s energy security by providing a reliable supply of LNG and promoting sustainable energy solutions in alignment with global energy transition goals.

ADNOC’s Vision for the Future

ADNOC is focusing on expanding its LNG and natural gas capacities as it considers these resources crucial for its future growth alongside renewables and petrochemicals. The company’s strategic investments in projects like Ruwais LNG and its other ventures aim to cater to the surging global demand for natural gas, which is expected to grow by more than 50% by 2040. ADNOC’s efforts reflect a broader vision of balancing energy security with sustainability, leveraging digital and AI technologies to minimize emissions and optimize production processes.