Abu Dhabi’s state-owned Adnoc has started trading derivatives at the first of two new trading arms, as it seeks to gain more value from its production.

The new crude-focused entity, Adnoc Trading (AT) has started derivatives trading as a direct market participant, the company said, although it would not confirm exactly when first trades were made. AT’s remit will primarily cover crude trade, eventually including third-party volumes, according to market participants.

The second entity, Adnoc Global Trading (AGT), a joint venture with Italy’s Eni and Austria’s OMV, will focus on trading refined products from Adnoc’s 817,000 bpd Ruwais refinery complex.

AGT may eventually trade crude depending on customer requirements, a source close to the company said. It is not clear if AGT’s crude marketing ventures would overlap with those of AT, or if one would be more geared towards refinery feedstock supplies. AGT was to begin trading operations in the second quarter, but this was stalled by hiring delays and logistical complications caused by the COVID-19 pandemic.

Adnoc said: “The AGT trading team are already optimising Adnoc’s flows (crude, feedstock and product optimisation), and, as its new trading systems are finalised will ramp up its activities,”

Adnoc hopes to create new revenue streams from the sale of its growing crude and refined products portfolio, one of its key goals under its ‘Adnoc 2030’ strategy. It produces more than 40mn t/yr of refined products, petrochemicals feedstock and propylene for domestic and export markets. It plans to expand Ruwais and to build a separate greenfield 400,000 b/d refinery geared towards petrochemicals at the complex. Additionally, a $3bn crude flexibility project is in process that will allow its refineries to process more sour crudes and free up domestic Murban output for export.

Elsewhere, Adnoc Logistics & Services is expanding its merchant fleet in line to meet the additional requirements of the firm’s upstream and downstream expansions, and its move into trading.

For more information visit www.adnoc.ae

5th October 2020