Domestic market lifts ADNOC Gas amid export decline
Local demand is rising due to population growth, expanding petrochemical and industrial use, and new data centers.
ADNOC Gas, the listed unit of Abu Dhabi's state-owned energy company, has seen a significant 52% drop in profit for the second quarter, falling to $665 million. This decline follows a decline in exports of liquefied natural gas and other products since late February. However, the company has maintained profitability and continues with its investment plans, thanks to the rise in domestic demand.
ADNOC Gas has awarded $8.2 billion in contracts for domestic gas projects, as part of the $28 billion in planned investments by 2030.
The local demand is on the rise due to factors such as population growth, expansion in petrochemical and industrial sectors, and new data centers. The UAE's exit from OPEC has further benefited ADNOC, allowing it to increase oil production and, subsequently, gas to sell. Despite remaining profitable during the war and absorbing losses from facilities targeted by Iranian strikes, ADNOC Gas is still dependent on the Strait of Hormuz for most of its revenue.
The company forecasts full-year earnings of up to $4 billion if normal flows resume through Hormuz by the fourth quarter, which is lower than the $5.2 billion it earned last year.
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