Adnoc signed new liquefied natural gas supply agreements with Chinese companies amid strengthening of economic ties between the UAE and the world’s second-largest economy.
As part of the 15-year contract with a unit of ENN Natural Gas, Adnoc will supply up to one million tonnes of liquefied natural gas annually to the Chinese private company, state news agency Wam reported, quoting a statement from Adnoc.
This is the largest LNG supply agreement to be signed between the UAE and a Chinese partner and was completed during the visit of Dr Sultan Al Jaber, Minister of Industry and Advanced Technology, and managing director and group chief executive of Adnoc, to China last week.
Adnoc also announced LNG supply deals with two other Chinese companies – CNOOC Gas and Power Group and ZhenHua Oil during the visit.
The new announcements come as the UAE, the Arab world’s second-largest economy, and China continue to strengthen economic ties. Last week, Adnoc opened a sales and marketing office in Beijing to boost long-term business relationships between the energy company and China.
"We are confident that the opening of this office and the signing of the LNG supply agreements are important steps that will contribute to strengthening co-operation with our Chinese partners," Dr Al Jaber said.
This would "create new opportunities to maximise benefits across various aspects and areas of the energy sector value chain".
Last year, Adnoc also signed strategic agreements with two Chinese energy companies to collaborate on low-carbon energy solutions. The pact with China National Offshore Oil Company aims to explore opportunities in new energy plans, low-carbon solutions, LNG ventures, oil and gas activities, and trading projects.
Meanwhile, an agreement with China National Petroleum Corporation will focus on the energy value chain, including low-carbon solutions, LNG, oil and gas exploration, advanced technologies, refining, marketing and trading.
The new agreements come as China looks to diversify its LNG imports. Australia, Qatar and Russia, as well as Malaysia and the US, were the biggest suppliers of LNG to China last year, according to a recent Reuters report.
Shell's 2025 LNG Outlook forecasts a 60 per cent increase in global demand for the fuel by 2040, driven by Asian economic growth, emissions reductions in industry and transport, and the rise of artificial intelligence.
The consumption of the fuel – considered a cleaner alternative to coal and crude oil – is expected to reach 630 million tonnes to 718 million tonnes a year by 2040, compared with 407 million tonnes last year, Shell said.