By: Reuters

Abu Dhabi National Oil Company has secured $11 billion in structured financing to monetise future gas production from its Hail and Ghasha development, the state company said on Thursday, after Russia's Lukoil exited the project.

The deal, signed with partners Eni (ENI.MI), opens new tab and PTTEP (PTTEP.BK), opens new tab, involves 20 global and regional banks. It uses a "pre-export finance" model backed by future gas throughput, providing upfront cash years before first production, which is expected by the end of the decade.

The transaction is the latest move in ADNOC’s strategy to leverage its balance sheet and fund a transition into a global energy major. The company has previously utilised lease-leaseback deals for infrastructure and listed six subsidiaries to raise billions of dollars. It also set up XRG, an international investment arm that has swelled to more than $150 billion in assets, including Germany's Covestro.

Lukoil exits Ghasha

Lukoil, which doubled its stake in Ghasha to 10% earlier this year, exited the concession in November, an ADNOC spokesperson told Reuters. The spokesperson said Lukoil transferred its stake to ADNOC following the sanctions but declined to provide further details. The move follows Lukoil’s efforts to divest its foreign operations, crippled by U.S. sanctions imposed in October aimed at pressuring Russia to end its war in Ukraine.

"It's the first-ever greenfield gas-based pre-export finance," a source close to the deal said, adding it allows ADNOC to lower the equity contribution and improve returns.

The non-recourse financing includes 11 local and regional banks, seven Asian banks, and three Western lenders, including Citi, Bank of China and ICBC.
"It's probably the largest participation from Chinese banks in a pre-export finance facility in the Middle East ever," the source said, adding ADNOC secured attractive rates.

Chinese banks lent over a third of the financing for Saudi Aramco's Jafurah, potentially the biggest shale gas project outside of the U.S., which aims to reach 2 billion standard cubic feet per day of gas by 2030.

ADNOC CEO Sultan Al Jaber, in a statement, said Hail and Ghasha "is an important contributor to ADNOC’s gas strategy and is on track to generate significant value." It aims to produce 1.8 bcfd of gas with net-zero emissions.