ADNOC Acquires Stake in Global Storage Operator VTTI

Photo courtesy of ADNOC
Photo courtesy of ADNOC
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ADNOC Acquires Stake in Global Storage Operator VTTI

Photo courtesy of ADNOC
Photo courtesy of ADNOC

The Abu Dhabi National Oil Company (ADNOC) has announced a strategic investment in global storage terminal owner and operator VTTI BV (VTTI).

As part of this agreement, ADNOC will acquire a 10 percent equity stake in VTTI.

Following the transaction, VTTI will be owned 10 percent by ADNOC, 45 percent by IFM Global Infrastructure Fund (IFM GIF), an investment vehicle managed by IFM Investors, and 45 percent by Vitol (both directly and through Vitol Investment Partnership II Ltd, an investment vehicle sponsored and managed by Vitol).

VTTI is an independent global owner of 15 hydrocarbon storage terminals across 14 different countries. Its storage network holds around 60 million barrels (9.5 million m3) of combined storage capacity, much of which is in locations that are complementary to ADNOC’s trade flows.

The investment in VTTI provides ADNOC access to storage capabilities across some of its key export markets such as Asia, Africa and Europe while also securing additional facilities at the port of Fujairah, UAE, its main storage hub.

The new agreement also significantly contributes to the development and growth of ADNOC’s global marketing, supply and trading platforms, providing greater access to knowledge and capabilities that will further enable ADNOC’s growth plans.

"We are delighted to be entering into this strategic investment opportunity in VTTI, alongside Vitol and IFM GIF, which will further complement the development of ADNOC’s integrated global trading platform while also delivering a solid financial return,” said UAE Minister of State and ADNOC Group CEO Dr. Sultan Ahmed Al Jaber.

“VTTI’s diverse portfolio of storage assets across key target markets such as Asia, Africa and Europe, provides us with direct access to our customers around the world, a key building block to accelerating ADNOC’s transformation into a more integrated and commercially-minded global energy player,” he was quoted as saying by Emirates News Agency (WAM).

He added: "As one of Fujairah’s largest storage operators, VTTI is a natural partner for ADNOC. This investment further strengthens ADNOC’s strategic position in Fujairah and supports the continued development of Fujairah as a strategic hub for our operations."

By expanding its international storage capabilities and reach, ADNOC will move closer to its customers, allowing it to be more agile and respond quickly to market needs and dynamics, the news agency said.

It will also unlock incremental revenue, margin and cost saving opportunities from the trading, transportation and storage of its products, giving ADNOC better control over where, when and how its products are being supplied to key markets and customers, it added.

"This exciting development is testament to the professionalism and dedication of our VTTI colleagues. Since VTTI was founded 13 years ago, we have worked tirelessly to build a market-leading hydrocarbon storage company, capable of delivering the highest standards of service in key strategic locations,” WAM quoted VTTI’s CEO, Rob Nijst, as saying.

“We are very pleased to have ADNOC as our new shareholder and look forward to benefiting from their regional expertise, working together to further grow our global network of terminals and supporting ADNOC’s trading and supply ambitions,” he added.



Riyadh Real Estate Awaits Impact of Measures to Curb Price Surge

Residential and commercial properties in the Saudi capital Riyadh (Reuters)
Residential and commercial properties in the Saudi capital Riyadh (Reuters)
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Riyadh Real Estate Awaits Impact of Measures to Curb Price Surge

Residential and commercial properties in the Saudi capital Riyadh (Reuters)
Residential and commercial properties in the Saudi capital Riyadh (Reuters)

The Saudi real estate market is currently in a state of cautious anticipation, driven by unprecedented decisions and measures announced by Crown Prince Mohammed bin Salman.

These steps aim to increase the supply of properties and restore balance in the market to address the rising costs of land and rental prices.

Data from the market shows a stagnation in property purchases by citizens, as they await the impact of these measures, hoping they will bring stability to property prices in Riyadh and lower costs.

In March, the Crown Prince directed the implementation of a series of regulatory measures, including lifting restrictions on the development of over 81 square kilometers of land north of Riyadh.

This move is expected to deliver tens of thousands of affordable residential plots annually to citizens, following a significant rise in property prices in Riyadh.

According to Saudi Minister of Municipal and Rural Affairs and Housing Majid Al-Hogail, these measures will add between 10,000 and 40,000 plots of land annually in the northern region of Riyadh, ensuring a better balance between supply and demand in the market.

The Crown Prince has already donated 1 billion riyals to the National Developmental Housing Foundation (Sakan), represented by Jood Eskan, to support home ownership for eligible families across Saudi Arabia.

The housing projects funded by this donation are to be completed within 12 months and executed by national companies.

The Crown Prince also ordered monthly progress reports to ensure that all residential units are delivered within one year.

Real estate market experts told Asharq Al-Awsat that current market data reveals a stagnation in property purchases by citizens, as they await the impact of recent policy changes and their potential to restore balance to the market.

Many real estate companies and agencies have observed a decline in sales activity, with property marketers facing difficulties in encouraging buyers who prefer to delay decisions until the effects of Crown Prince Mohammed bin Salman’s directives take shape.

Real estate expert and marketer Abdullah Al-Mousa told Asharq Al-Awsat that the current stagnation in property prices in Riyadh is a direct result of the Crown Prince’s initiatives to increase property supply, which aim to restore price equilibrium following the recent surge in real estate costs.

He views the decline as a positive step toward balancing supply and demand, contributing to a more sustainable and fair market for all stakeholders.

Al-Mousa anticipates that this stagnation will persist until all government directives are fully implemented in the coming months.

He noted that, with plans to increase the property supply, the market could experience gradual recovery in the long term, especially given Riyadh’s continued population and economic growth.

The expert highlighted that several factors may sustain the current stagnation, including high interest rates, which reduce citizens’ purchasing power, the oversupply of properties relative to demand, and global economic fluctuations that could affect investments.

However, he emphasized that Riyadh’s ongoing population growth, improving national economy, rising per capita income, large-scale infrastructure projects like the Riyadh Metro, and continued government support for housing programs are expected to drive the recovery of the real estate market.

Al-Mousa also predicted further improvement in the sector as policies are implemented and market conditions are monitored.