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Gulf oil giants make billions in infrastructure deals

Gulf Arab national oil firms have a strategy that involves raising funds while maintaining control of oil and gas assets. This has helped them raise billions.

Here are some key facts regarding such deals.

ADNOC of the UAE

ADNOC raised $4 billion by creating a new subsidiary in 2019. ADNOC Oil Pipelines was created and leased 18 pipelines to a consortium that included BlackRock and KKR for a period of 23 years. The investors bought a 40% stake, while ADNOC retained 60% of the company and had full control.

ADNOC created ADNOC Gas Pipelines in 2020 and sold a 49 percent stake to a group consisting of six investors. These included Global Infrastructure Partners, Brookfield Asset Management and Singapore's sovereign fund GIC. Other investors include Ontario Teachers' Pension Plan Board and Snam. This deal raised $10 billion.

Lunate, an Abu Dhabi-based company, acquired BlackRock & KKR's 40% stake in the oil pipeline on April 20, 2024. Snam, the indirect owner of a stake in the entity that owned the gas pipeline, announced to Lunate in January 2024 it had also sold its shares. Lunate, an Abu Dhabi based alternative investment manager, is part of the business empire headed by Sheikh Tahnoun Bin Zayed Al Nahyan.

KKR bought a minor stake in ADNOC Gas Pipeline on Tuesday.

SAUDI ARAMCO

Aramco sold its 49% stake in Aramco Oil Pipelines Co. to EIG Global Energy Partners under a 25 year lease for $12,4 billion.

In the same year, Aramco Gas Pipelines Co. was formed and a 49% share of it was sold to a group headed by BlackRock and Hassana Investment Co.

Aramco, a consortium led Global Infrastructure Partners and BlackRock, signed a lease-and-leaseback agreement for infrastructure surrounding its Jafurah project in 2025.

Aramco retains majority ownership in all transactions and maintains operational control.

Reports in July indicated that Aramco was looking to sell five gas-fired plants, which could raise $4 billion. This is part of an effort to release funds that could bring in tens or hundreds of millions of dollars.

Oman's OQ

Oman raised $750 million in 2023 by selling a 49% stake of its gas pipeline company, OQ Gas Networks.

Fluxys, a Belgian company and the Qatar Investment Authority in Qatar are among the key investors.

OQ retains 51% ownership, and has operational control.

BAHRAIN'S BAPC

Bapco Energies, a subsidiary of BlackRock Infrastructure Fund, sold a minor stake in the Saudi Bahrain oil pipeline last year.

This was Bahrain's very first infrastructure monetization. The deal's value wasn't disclosed.

Bapco retains majority ownership as well as operational control.

KUWAIT PETROLEUM CORPORATION (KPC)

KPC's CEO, Sheikh Nawaf Nasir al-Sabah, has revealed that the company is looking at a lease-leaseback agreement for its oil pipeline system. This would be a similar deal to those used by ADNOC or Aramco. He did not give any figures.

Bloomberg reported that the deal involved 13 pipelines, and that it could raise between $5 billion and $7 billion. Centerview Partners advises on the possible transaction, according to people familiar with the issue.

KPC will retain operational control.

Kuwait's official news agency reported in September that BlackRock would open an office and Ali AlQadhi will lead operations in Kuwait.

BlackRock declined to comment on the potential deal with KPC. (Reporting and editing by Elaine Hardcastle; Yousef SABA)

(source: Reuters)