ADNOC, Wanhua Chemical form joint venture for LPG shipping
"Shipping JV will be responsible for transporting LPG cargoes and other petroleum products, sourced from the ADNOC Group and global suppliers, to Wanhua Group’s manufacturing bases in China and around the world."
ADNOC Logistics & Services (ADNOC L&S), the shipping and maritime logistics subsidiary of the Abu Dhabi National Oil Company (ADNOC), has announced the formation of a new strategic joint venture (JV) with Wanhua Chemical Group. The new company, named AW Shipping Limited, is incorporated in Abu Dhabi Global Market (ADGM) in the United Arab Emirates (UAE).
AW Shipping will own and operate a fleet of very large gas carriers (VLGCs) and modern product tankers. The company will be responsible for transporting LPG cargoes and other petroleum products, sourced from the ADNOC Group and global suppliers, to Wanhua Group’s manufacturing bases in China and around the world.
H.E. Dr. Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology and ADNOC Group CEO, said: "We are very pleased to establish this strategic joint venture with Wanhua Chemical Group. This creative win-win partnership strengthens our growing relationship and will deliver greater value and efficiency for both our organisations. Importantly, the JV further solidifies ADNOC L&S’ position as the largest, fully integrated logistics and shipping company in the UAE and paves the way for the transportation of greater LPG volumes to China, in line with market demand.
“The establishment of AW Shipping supports ADNOC’s smart growth and value creation strategy and is another example of how ADNOC is stretching the margin from every molecule that we produce, refine, ship and sell, while also forging stronger partnerships in key growth markets.”
The formation of AW Shipping follows a 10-year LPG supply contract signed between ADNOC and Wanhua in November 2018.
ADNOC L&S delivers oil, gas, and petroleum products to customers across the world. It owns and operates the UAE’s largest shipping fleet, which it expects to grow further in the coming years as ADNOC increases its upstream and downstream production capacity, and enters into trading.
Liao Zengtai, Chairman of Wanhua Chemical Group, said: “We are very glad that joint venture has been established with the concerted efforts of both parties. The new company will strengthen the strategic cooperation between ADNOC and Wanhua and will also ensure the stable supply of LPG cargoes and other petroleum products for Wanhua system. More importantly, the cooperation will make contribution to the “One Belt, One Road” project.”
ADNOC L&S was formed in late 2016 from three ADNOC subsidiaries, ADNATCO, IRSHAD, and ESNAAD.
The company is involved in four major activities; firstly, shipping activities, either with its own vessels or via chartering, which includes crude and refined products, dry bulk, and LNG transport. Secondly, marine service activities which comprise petroleum port operations, diving, and oil spill response. Thirdly, offshore logistics activities that include offshore support vessels and an integrated logistics base in Mussafah, Abu Dhabi, one of the largest in the region. Finally, onshore activities which consist of a marine passenger terminal and a container terminal.
Last year, ADNOC L&S transported over 20 million t of various oil and gas products and dry bulk commodities.
Wanhua Group is one of the world's leading producers for methylene diphenyl diisocyanate (MDI), a key ingredient in the manufacture of high-performance adhesives and synthetic fibres, which go into a wide range of industries.