Adnoc Logistics and Services (Adnoc L&S), the shipping and maritime logistics subsidiary of the Abu Dhabi National Oil Company (Adnoc) announced on Tuesday the formation of a new strategic joint venture (JV) with Wanhua Chemical Group.

The new company named AW Shipping Limited is incorporated in Abu Dhabi Global Market.

This strategic agreement further strengthens the collaboration between Adnoc and Chinese companies and builds on the deep-rooted bilateral relations between China and the UAE. The joint venture underscores Adnoc’s focus on value-creating deals and will support the delivery of its 2030 smart growth strategy.

AW Shipping Limited will own and operate a fleet of very large gas carriers (VLGCs) and modern product tankers. The company will be responsible for transporting liquefied petroleum gas (LPG) cargoes and other petroleum products, sourced from the Adnoc Group and global suppliers, to Wanhua Group’s manufacturing bases in China and around the world. To deliver maximum fleet efficiency, the company may also pursue other market opportunities.

Dr Sultan Ahmed Al Jaber, Minister of Industry and Advanced Technology and Adnoc Group CEO, said, “We are very pleased to establish this strategic joint venture with Wanhua Chemical Group. This creative win-win partnership strengthens our growing relationship and will deliver greater value and efficiency for both our organizations. Importantly, the JV further solidifies Adnoc L&S’ position as the largest, fully integrated logistics and shipping company in the UAE and paves the way for the transportation of greater LPG volumes to China, in line with market demand.

“The establishment of AW Shipping supports Adnoc’s smart growth and value creation strategy and is another example of how Adnoc is stretching the margin from every molecule that we produce, refine, ship and sell, while also forging stronger partnerships in key growth markets.”

The formation of AW Shipping follows a 10-year LPG supply contract signed between Adnoc and Wanhua in November 2018.

Adnoc L&S is a crucial enabler in the Adnoc value chain, delivering oil, gas, and petroleum products to customers across the world. It owns and operates the UAE’s largest shipping fleet, which it expects to grow further in the coming years as Adnoc increases its upstream and downstream production capacity, and enters into trading.

Liao Zengtai, Chairman of Wanhua Chemical Group, said, “We are very glad that joint venture has been established with the concerted efforts of both parties. The new company will strengthen the strategic cooperation between Adnoc and Wanhua and will also ensure the stable supply of LPG cargoes and other petroleum products for Wanhua system.

WAM