ADNOC Gas plc (the “Company” or “ADNOC Gas”), the world-class integrated gas processing company, today announces its intention to proceed with an initial public offering (the “IPO” or the “Offering”) of 3,070,056,880 of its shares and to admit its shares for listing and trading (“Admission”) on the Abu Dhabi Securities Exchange (“ADX”). 
 
ADNOC intends to offer approximately 4% of ADNOC Gas’ issued share capital in the Offering: (i) as part of the UAE Retail Offering, to: (a) individuals and other investors in the UAE; (b) employees of ADNOC group companies residing in the UAE; and (c) UAE national retirees of ADNOC group companies residing in the UAE; and (ii) as part of the Qualified Investor Offering, to qualified institutional and other investors. The Selling Shareholder retains the right to amend the size of the Offering at any time before pricing of the Offering, subject to the applicable laws of the UAE and the approval of the SCA.
 
The Company is registered as a public company limited by shares incorporated in the Abu Dhabi Global Market (the “ADGM”) and is subject to the ADGM Companies Regulations 2020 (as amended). 
 
OFFERING HIGHLIGHTS
 
Subject to market conditions and obtaining relevant regulatory approvals in the UAE, including the approval of Admission:
 
• Intention to list on ADX.
• 3,070,056,880 shares are being made available in the Offering, representing approximately 4% of ADNOC Gas’ issued share capital.
• All shares offered shall represent the sale of existing shares held by Abu Dhabi National Oil Company (ADNOC) P.J.S.C. (“ADNOC” or the “Selling Shareholder”) at the time of Admission.
• The UAE Retail Offering (as defined below) subscription period is expected to run from 23 February 2023 to 1 March 2023.
• The Qualified Investor Offering (as defined below) subscription period is expected to run from 23 February 2023 to 2 March 2023.
• Admission is anticipated to occur on 13 March 2023.
 
Commenting on the launch of the ADNOC Gas IPO process, Khaled Al Zaabi, Acting Group CFO of ADNOC, said: “We are very pleased to announce our intention to float a minority stake in ADNOC Gas, our world-class gas processing, operations and marketing company. Natural gas is central to the energy transition and as the UAE’s gas champion, ADNOC Gas is well-positioned to responsibly harness our significant natural gas resources, while driving efficiencies, delivering value, and reliably supplying this key fuel to meet the world’s growing energy needs. 
 
“This is the fifth occasion where we are bringing an ADNOC company to the market in as many years, and we are delighted to once again offer international and local investors a highly compelling investment opportunity, allowing shareholders to partake in ADNOC and Abu Dhabi’s ongoing value creation journey.”
 
Ahmed Mohamed Alebri, Acting Chief Executive Officer of ADNOC Gas, said: “ADNOC Gas is a vital component of the UAE’s energy system and is at the heart of the country’s goals of achieving gas self-sufficiency and becoming a gas net exporter. This is enabled by our dedicated people and world-class integrated gas platform with access to a total gas processing capacity of over 10 billion standard cubic feet per day and a liquid processing capacity of 29 million tonnes per year, that is underpinned by a competitive and reliable feedstock supply. With anticipated substantial and consistent revenues and resilient margins, we believe that ADNOC Gas is well positioned to benefit from robust long-term demand trends for global gas, whilst playing a critical role in driving decarbonization in line with the UAE’s Net-Zero strategy.”
 
DETAILS OF THE OFFERING
 
The Selling Shareholder intends to sell approximately 4% of the Company’s issued share capital, with the Selling Shareholder retaining the right to amend the size of the Offering at any time before pricing of the Offering, subject to the applicable laws of the UAE and the approval of the SCA. It is intended that the Offering will comprise: (i) a UAE public offering to: (a) individuals and other investors in the UAE; (b) employees of ADNOC group companies residing in the UAE; and (c) UAE national retirees of ADNOC group companies residing in the UAE (together, the “UAE Retail Offering”); and (ii) an offering to qualified institutional and other investors in a number of countries, including the UAE (the “Qualified Investor Offering”). The indicative price range per share will be determined in due course and published on the Offer opening date and contained in the International Offering Memorandum. The final offer price per share (the “Offer Price”) will be determined through, and following, a bookbuilding process. Retail investors in the UAE Retail Offering will subscribe for shares at the Offer Price. 
 
All of the shares are being offered by the Selling Shareholder which, prior to the Offering, holds approximately 95% of the share capital of the Company. The net proceeds generated by the Offering will be received by the Selling Shareholder. All expenses of the Offering will be borne by the Selling Shareholder. The Offering is being conducted, among other reasons, to allow the Selling Shareholder to sell part of its shareholding to more actively manage and optimize its portfolio of assets, while providing increased trading liquidity in the shares of the Company and raising the Company’s profile within the international investment community.  
 
Prior to the Offering, ADNOC transferred to Abu Dhabi National Energy Company PJSC (“TAQA”) approximately 5% of the share capital of the Company. TAQA is the holding company for a leading integrated energy and utilities group headquartered in Abu Dhabi and has a long-standing strategic partnership with ADNOC. ADNOC is expected to own approximately 91% of ADNOC Gas’ share capital post-IPO (assuming a sale of approximately 4% of the share capital of the Company by the Selling Shareholder via the Offering). 
 
The UAE Retail Offering subscription period is expected to open on 23 February 2023 and is expected to close on 1 March 2023. Meanwhile, the Qualified Investor Offering subscription period is expected to open on 23 February 2023 and is expected to close on 2 March 2023.
 
The completion of the Offering and Admission is currently expected to take place no later than 13 March 2023, subject to satisfactory market conditions and obtaining relevant regulatory approvals in the UAE, including the approval of the Admission from the SCA.
 
Details of the Offering will be included in the Arabic and English language UAE Prospectus and the UAE public announcement (the “Public Announcement”) in respect of the UAE Retail Offering and the English language International Offering Memorandum in respect of the Qualified Investor Offering. The UAE Prospectus and the Public Announcement will be published today, and the International Offering Memorandum is expected to be published on 23 February 2023.
 
Moelis & Company UK LLP DIFC Branch has been appointed as the Independent Financial Advisor to the Company.
 
First Abu Dhabi Bank PJSC and HSBC Bank Middle East Limited have been appointed as Joint Global Coordinators. Abu Dhabi Commercial Bank PJSC, Arqaam Capital Limited, BNP PARIBAS, Deutsche Bank AG, London Branch, EFG-Hermes UAE Limited (acting in conjunction with EFG Hermes UAE LLC) and International Securities L.L.C. have been appointed as Joint Bookrunners.  First Abu Dhabi Bank PJSC has been appointed as the Lead Receiving Bank. Abu Dhabi Commercial Bank PJSC, Abu Dhabi Islamic Bank PJSC and Al Maryah Community Bank have been appointed as the Receiving Banks. 
 
Neither HSBC Bank Middle East Limited nor any of its respective affiliates is responsible for participating in, marketing or managing any aspect of the UAE Retail Offering to natural persons.
 
The Shariah Supervision Committee of First Abu Dhabi Bank PJSC has issued a pronouncement confirming that, in its view, the Offering is compliant with Shariah principles. Investors may not rely on this pronouncement and should undertake their own due diligence to ensure that the Offering is Shariah compliant for their own purposes.
 
OVERVIEW OF ADNOC GAS
 
ADNOC Gas was established for the purpose of serving as a holding company of ADNOC Gas Facilities LLC (“Gas Co”) and ADNOC Gas Operations and Marketing LLC (“O&M Co”) in connection with the reorganization of ADNOC’s gas business (the “Reorganisation”) consisting of ADNOC’s interests in: (i) each of two joint ventures, Abu Dhabi Gas Liquefaction Company Limited (“ALNG”) and Abu Dhabi Gas Industries Limited (“AGP”); (ii) ADNOC Industrial Gases Company Limited—Sole Proprietorship L.L.C (“AIG”); and (iii) gas processing operations and assets, historically conducted by ADNOC on sole risk basis (“ASR”) through AGP, ALNG or AIG (together, the “ADNOC Gas Business”). 
 
The completion of the Reorganization resulted in ADNOC holding 100% of the total issued and outstanding share capital of ADNOC Gas, and ADNOC Gas owning the ADNOC Gas Business through its wholly-owned subsidiary, Gas Co. As part of the post-reorganization optimization planned for the future, O&M Co is expected to consolidate the operations, maintenance and marketing of ADNOC Gas’ gas processing and LNG operations. 
 
ADNOC Gas group’s asset base is spread across Abu Dhabi and comprises gas processing operations, LNG operations and industrial gases operations.
 
BUSINESS HIGHLIGHTS
 
ADNOC Gas is a world-class integrated gas processing company that is vital to ADNOC and to both the Abu Dhabi and UAE energy ecosystems. The ADNOC Gas group’s operations are today the only route to monetise Abu Dhabi's vast gas reserves by connecting them to their end customers for sales gas, LNG, NGLs and condensates in both domestic and international markets. As such, ADNOC Gas plays a central role in ADNOC's gas monetisation value chain.

With ESG at the core of ADNOC Gas’ operations, and in line with ADNOC's vision, ADNOC Gas is focused on decarbonisation efforts and believes it is able to help drive the energy transition in the UAE. Important steps have been taken to reduce emissions intensity in the ADNOC Gas Business (such as zero carbon grid power and zero flaring as part of routine operations), and ADNOC Gas is planning further abatement initiatives. ADNOC Gas is expected to be an important contributor to ADNOC's emissions reduction target.

At the core of ADNOC Gas’ business is a focus on operational excellence and building on existing high levels of asset reliability across operations. The ADNOC Gas group runs world-class, large-scale processing and liquefaction assets that have a proven track record of operational excellence consistently delivering exceptional results driven by high plant availability, capacity utilisation and reliability.
 
ADNOC Gas’ differentiated platform benefits from a combination of low-cost base with rich, largely contracted molecules that mix attractive margins with dependable demand. Through a long-term Gas Supply and Payment Agreement with ADNOC, the ADNOC Gas group benefits from access to the world’s 7th largest gas reserves, which it believes represents one of the lowest-cost upstream resource bases in the world, and is provided a stable flow of feedstock that is rich in NGLs and condensates. Due to ADNOC’s low-cost production relative to the gas production market globally, the ADNOC Gas group’s feedstock is more resilient to commodity price cycles than other upstream operations with higher production and development costs, which contributes to its attractive margins.
 
ADNOC Gas expects to benefit from projected robust, long-term demand globally through its tangible growth opportunities, in view of the projected rise in gas demand in the next 25-30 years. ADNOC Gas is advantageously located in a strategically situated corridor with easy access to the largest and growing gas markets, which offers optionality to ship products both to Asia and Europe with sales in the spot market enabling selection of an optimal supply destination.
 
ADNOC Gas has a highly experienced management team with a long track record in its business, backed by strong support from its shareholder, ADNOC. The members of ADNOC Gas’ management team, the majority of whom have been instrumental in different parts of the ADNOC Gas Business or otherwise within the ADNOC group, have a combined 196 years of gas industry experience and have worked in various management and leadership roles across ADNOC and other major companies in the industry. The team's combined industry and regional expertise enables ADNOC Gas to clearly understand and effectively manage the inherent risks associated with the business.

COMPANY STRATEGY
 
Position the Company to benefit from ADNOC’s plans to accelerate monetisation of Abu Dhabi’s hydrocarbon resources while advancing the UAE's objectives of becoming a gas net-exporter and of gas self-sufficiency.

Continue efforts to be at the forefront of the energy transition through implementing ESG policies and meeting ADNOC’s sustainability goals.

Enhance the value of the ADNOC Gas group’s products to further enable ADNOC’s petrochemicals business and optimise the gas processing product mix, increasing the share of higher margin products, while extending market reach domestically and in export markets.

CAPITAL STRUCTURE AND DIVIDEND POLICY
 
Subject to completion of the Offering, ADNOC Gas expects to target payment of dividends of USD 1,625 million in the fourth quarter of 2023 in respect of the first half of the year ended 31 December 2023; and a further USD 1,625 million in the second quarter of 2024 in respect of the second half of the year ended 31 December 2023. Thereafter, ADNOC Gas expects to grow the annual target dividend amount from USD 3,250 million (which is equal to the annualized dividend for the year ended 31 December 2023) by a growth rate of 5% per annum on a dividend per share basis over the period 2024-2027. ADNOC Gas’ ability to pay dividends is dependent on a number of factors, among others, the availability of positive net income distributable reserves, capital expenditure plans and market conditions. There is no assurance that ADNOC Gas will pay dividends or, if a dividend is paid, what the amount of such dividend will be.
 
CORPORATE GOVERNANCE
 
The Board of Directors is committed to standards of corporate governance that are in line with international best practice. All seven members of the Company’s Board are appointed in accordance with the SCA corporate governance rules. The Board will establish three permanent committees - an Audit Committee, a Nomination and Remuneration Committee (each of which will be subject to the composition requirements of the SCA corporate governance rules) and an Executive Committee.
 
MEDIA ENQUIRIES     
ADNOC GROUP     
Oliver Thompson    
+971 2 707 5950        
      
INVESTOR / ANALYST ENQUIRIES
ADNOC GAS     
Peter Van Driel    
+971 2 707 3177
 
Joint Global Coordinators 
First Abu Dhabi Bank PJSC 
HSBC Bank Middle East Limited 
 
Joint Bookrunners 
Abu Dhabi Commercial Bank PJSC 
Arqaam Capital Limited 
BNP PARIBAS 
Deutsche Bank AG, London Branch 
EFG-Hermes UAE Limited (acting in conjunction with EFG Hermes UAE LLC) 
International Securities L.L.C. 
 
Lead Receiving Bank 
First Abu Dhabi Bank PJSC 
 
Receiving Banks 
Abu Dhabi Commercial Bank PJSC
Abu Dhabi Islamic Bank PJSC
Al Maryah Community Bank 
 
Independent Financial  Advisor 
Moelis & Company UK LLP DIFC Branch           
 
Financial Communications Advisor 
Teneo           
Andy Parnis    
+971 50 457 2394

Stephen Smith    
+971 58 546 1588