The United Arab Emirates gas company, ADNOC Gas, made a spectacular stock market debut, raising more than 2.3 billion euros. This news has sparked great interest in the global gas market. It has experienced a resurgence in activity after a decline due to the conflict between Ukraine and Russia in 2022. The United Arab Emirates is now a key player in the natural gas market and the export of liquefied natural gas (LNG), as a clean transition fuel.
Background of ADNOC Gas’s IPO
ADNOC (Abu Dhabi National Oil Company) Gas, a subsidiary of the Emirati oil giant, was formed earlier this year to bring together the emirate’s gas and liquefied natural gas (LNG) exploration, maintenance, and marketing activities. The IPO price for ADNOC Gas was set at 2.37 dirhams (0.61 euros), allowing the company to raise more than 2.3 billion euros and valuing it at approximately 47.1 billion euros.
The initial public offering was oversubscribed 50 times, generating demand of over 116 billion dollars from investors. To meet this demand, ADNOC Gas increased its offering to approximately 5% of its capital, up from the initially planned 4%, with the parent company retaining 90% of the shares.
Global gas market in recovery
ADNOC Gas’s IPO comes amid a recovery in the global gas market, a year after the conflict between Ukraine and Russia in 2022. The conflict led to a decrease in Russian gas deliveries, prompting Europeans to seek alternatives. Gas is also considered cleaner than other fossil fuels, such as coal or oil.
Mr. Baroudi added
As global efforts to combat climate change intensify, the role of natural gas in general (…) is widely expected to grow
Indeed, according to the bp Statistical Review of World Energy, the United Arab Emirates produced about 57 billion cubic meters of natural gas in 2021, accounting for about 1.4% of global production. Regarding LNG exports, they reached 8.8 billion cubic meters, or nearly 1.7% of global trade.
The stock market debut of the United Arab Emirates gas company marks a significant milestone in their economic and financial development. This reflects their leadership position in the region and their dynamism in the global liquefied gas markets.