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ADNOC signs $4 billion pipeline infrastructure deal with KKR, BlackRock

The deal, expected to close in the third quarter of 2019, will result in upfront proceeds of some $4 billion to ADNOC.

Reuters  |  Abu Dhabi 

OMC, oil
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Company (ADNOC) has sealed a $4 billion midstream pipeline infrastructure deal with U.S. investment firms and BlackRock, the Abu Dhabi government owned company said on Sunday.

A new entity called Pipelines will lease the firm's interest in 18 pipelines, transporting crude oil and condensates across Adnoc's offshore and onshore upstream concessions for a 23-year period, said in a statement.

Funds managed by and will form a consortium to hold a 40 percent stake in the entity with owning the remainder. ADNOC will have sovereignty over the pipelines and management of pipeline operations.

The deal, expected to close in the third quarter of 2019, will result in upfront proceeds of some $4 billion to ADNOC.

The statement cited Sultan al Jaber, ADNOC group CEO, as saying the deal validated ADNOC's approach of "unlocking value from its portfolio of assets while retaining control over their ownership and operation".

is investing through its Global Energy & Power Infrastructure Fund series while KKR's investment is through its third Global Infrastructure Investors Fund, the statement said.

"We believe that today's agreement among ADNOC, and will be followed by many more such partnerships to invest in the future growth of the region," BlackRock CEO and chairman Laurence Fink said.

Since 2017, ADNOC has been expanding its strategic partnership model. The latest deal follows several other initiatives including ADNOC's debut capital markets transaction, the issuance of the Abu Dhabi Crude Oil Pipeline bond, the IPO of ADNOC Distribution and others.

First Published: Sun, February 24 2019. 13:50 IST
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