Abu Dhabi National Oil Company (ADNOC) is set to transfer its holdings in a hydrogen venture with Exxon Mobil Corp. and in NextDecade Corp.’s LNG export project to its newly established energy-focused entity, XRG. According to ADNOC CEO Sultan Al Jaber, XRG is designed to drive investment in advanced technologies and innovations that support the global energy transition.
Al Jaber detailed these plans in a recent column for the news website Semafor.ADNOC has been actively expanding its presence in the U.S. energy sector. In September, it secured a 35% stake in ExxonMobil’s proposed hydrogen project in Baytown, Texas, which is anticipated to become the world’s largest upon completion. This followed ADNOC’s acquisition in May of a stake in NextDecade’s LNG project, also located in Texas.
These strategic investments align with ADNOC’s broader vision of diversifying its portfolio beyond traditional oil production and strengthening its position in the global gas and hydrogen markets.Last year, ADNOC unveiled plans to establish XRG as a major player in the evolving energy landscape, stating that the company will have an enterprise value exceeding $80 billion. Over the next decade, ADNOC aims to more than double the value of XRG’s assets as part of its long-term growth strategy.
The official launch of XRG is scheduled for the first quarter of this year.As part of its expansion efforts, ADNOC has confirmed that XRG will take control of Covestro AG following a nearly $13 billion acquisition deal. Additionally, XRG will oversee Abu Dhabi’s stake in a joint venture with BP Plc, which focuses on gas projects across the Mediterranean region, including key developments in Egypt.The UAE has been actively expanding its footprint in the chemicals and gas sectors to meet rising global energy demands and provide essential materials for consumer products.
ADNOC, in particular, has been shifting its strategy beyond crude oil by investing in gas trading and chemical derivatives such as plastics, which are expected to play a crucial role in the energy transition.Further expanding its presence in the chemicals industry, ADNOC recently confirmed that it is in discussions with Abu Dhabi’s sovereign wealth fund, Mubadala Investment Co., regarding a potential acquisition of Nova Chemicals.
This Canadian petrochemical company operates two production facilities in the U.S., further reinforcing ADNOC’s ambition to become a leading global player in the energy and chemicals sectors.
