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• 
  Adnoc takes a leap forward in becoming a chemicals giant

  21 May 2025

  Commentary
  Indrajit Sen
  Oil & gas editor

  Abu Dhabi National Oil Company (Adnoc) has made a significant stride forward in its quest to build a burgeoning chemicals business following the European Union’s (EU) approval for the full acquisition of German chemicals producer Covestro.

  Adnoc International, the overseas business arm of Adnoc Group, signed an investment agreement with Covestro on 1 October, in which it made a takeover offer of €14.7bn ($16.3bn).

  On 13 May, the European Commission, the executive wing of the EU, gave unconditional antitrust approval for the acquisition, saying that the transaction does not raise competition concerns. It added that the companies mainly operate at different levels of the chemical and petrochemical supply chain and would not be able to restrict rivals’ access to inputs or customers.

  Having secured the green light for the Covestro takeover, Adnoc will now look to complete the transaction swiftly. In parallel, the Abu Dhabi energy giant is also likely to move quickly to conclude its deal with Austria’s OMV for a proposed combination of their shareholdings in Abu Dhabi’s Borouge and Austria-based chemicals producer Borealis.

  Adnoc and OMV agreed in March to the terms of a binding framework agreement for the merger of Borouge and Borealis. That, together with the contribution of the upcoming Borouge 4 petrochemicals project in Abu Dhabi, will create a major polyolefins producer valued at over $60bn that will be the world’s fourth-largest by nameplate production capacity.

  Separately, Adnoc also entered into a share purchase agreement in March with Canada-based Nova Chemicals Holdings, an indirectly wholly-owned company of Abu Dhabi’s sovereign wealth institution Mubadala Investment Company, for 100% of Nova Chemicals Corporation (Nova).

  With the takeover of Covestro likely to conclude in the next few months and the Borouge-Borealis merger, along with the acquisition of Nova, expected to be completed in the first quarter of 2026, Adnoc is set to morph into a behemoth in the global chemicals industry in less than a year.

  https://image.digitalinsightresearch.in/uploads/NewsArticle/13923953/main3831.jpg

  Indrajit Sen
• 
  Emerging Gulf-Asia corridor grows despite headwinds

  21 May 2025

  

   

  During his state visit to Saudi Arabia, Qatar and the UAE on 13-16 May, US President Donald Trump announced mulitibillion-dollar deals to advance shared interests in both traditional industries and emerging technologies.

  Saudi Arabia committed $600bn and Qatar pledged $400bn. The UAE, meanwhile, confirmed an investment of $200bn, the initial installment of a commitment to invest up to $1.4tn in the US over the next 10 years.

  Most of these investments will be in defence, energy, technology and artificial intelligence (AI) – sectors in which US companies have traditionally led or tended to dominate, and which are expected to see significant future expansion, benefiting the energy and economic diversification agendas of the Gulf states.

  “We’ve launched the golden age of America,” Trump said. “The golden age of the Middle East can proceed right alongside of us.”

  Asia ties

  These investments and trade commitments between the Gulf states and the US carry significant economic and geopolitical undertones. They are expected to generate new revenue streams, boost the global trade status of the GCC countries, and help to diversify their economies away from hydrocarbons. 

  However, the Gulf-US investments do not necessarily deprioritise the strategies of the GCC states in recent years to pivot investments towards Asia – in particular to China, India and several Southeast Asian nations.

  In May 2024, UAE President Mohamed Bin Zayed Al-Nahyan visited China, cementing UAE-China cooperation in several areas. Independent think tank Asia House described the visit as one of the most significant bilateral political exchanges of the year.

  Asia’s economic trajectory represents a pivotal opportunity to advance Mubadala’s sustainable growth and innovation mission, while building its presence in the region as part of a broader geographic diversification strategy.

  There have also been several bidirectional investments, led by the Gulf and Asia’s sovereign wealth funds – a trend that is likely to increase over the coming years.

  In October, Saudi sovereign wealth vehicle the Public Investment Fund and the Hong Kong Monetary Authority signed a memorandum of understanding (MoU) to work on jointly anchoring a new investment fund with a target size of $1bn.

  The fund will explore investments in manufacturing, renewables, financial technology (fintech) and healthcare, supporting the localisation in Saudi Arabia of companies connected to Hong Kong and the Greater Bay area, the latter comprising nine Chinese cities with populations of about 86 million.

  In January this year, Mohammed Albadr, head of Asia for private equity at Abu Dhabi's Mubadala Investment Company, informed the UBS Greater China Conference in Shanghai of his firm’s commitment to “doubling down on investments in Asia by 2030”.

  He said that Asia’s economic trajectory represents an opportunity to advance Mubadala’s sustainable growth and innovation mission, while building its presence in the region as part of a broader geographic diversification strategy.

  Ramping-up activity

  For those in the region with connections to Asian markets, there has been a significant uptick in activity “in both directions, throughout the Middle East-Asia corridor”, according to Tony Nicholson, a senior associate with international law firm Dentons.

  He says that this buoyancy is “leading to a smorgasbord of opportunity, not only for incumbents, but also for new market participants to explore across a diverse range of countries, economies and sectors within the corridor”.

  Policy shifts and investment aimed at scaling up renewable energy and low-carbon hydrogen ecosystems within the Middle East-Asia corridor continue to gain momentum, he notes, adding: “Socioeconomic dynamics are also catalysing growth in investment opportunities in transportation, logistics, digital and social infrastructure. We are seeing a lot of focus in these areas.”

  Inbound investment

  Chinese investments in renewable energy projects in the Gulf began nearly a decade ago. Saudi utility developer and investor Acwa Power signed an MoU with China’s state-owned Silk Road Fund in 2016 to partner on several large projects in the Middle East and North Africa power market.

  The same year, the Silk Road Fund took a 7.35% equity in Dubai’s $3.4bn Hassyan independent power project (IPP), which was initially planned to use coal but was converted to natural gas. In 2018, the fund then took a 24% equity share in Noor Energy 1, the project company that won the contract to develop and operate the $3.8bn hybrid solar photovoltaic (PV) and concentrated solar power IPP, also in Dubai.

  Three years later, the Silk Road Fund agreed to acquire a 49% stake in Acwa Power RenewCo, which owns existing renewable energy projects in the UAE and other countries in the Middle East and Africa.

  Outbound investments

  Since then, both Acwa Power and UAE-based Abu Dhabi Future Energy Company (Masdar) have invested or explored investments in renewable energy projects in China, and in emerging Southeast Asian markets such as Indonesia, Vietnam and the Philippines.

  In March 2025, Acwa Power said that it aims to invest up to $30bn in China, in line with its plans to triple overall assets under management to about $250bn globally.

  Masdar established the 145MW Cirata floating PV power plant in Indonesia in 2023, which is planned to be expanded to 500MW. It is also exploring the development of other floating solar projects in the country, and has made a strategic investment in Pertamina Geothermal Energy.

  Also in 2023, Masdar signed an agreement with the Malaysian Investment Development Authority to develop up to 10GW of renewable energy projects in the Southeast Asian country.

  This year, it has signed an agreement to develop up to 1GW of clean energy projects in the Philippines by 2030, including solar, wind and battery storage schemes.

  “Our partnerships with industry leaders across the region’s energy sector not only deliver clean power, but also create local jobs and support national economic growth,” Abdulaziz Alobaidli, Masdar's chief operating officer, tells MEED. “Our investments in the region are set to grow, supporting the transformation of the energy system and driving progress against the governments’ renewable energy goals.”

  Other sectors

  In addition to renewable energy projects, inbound Middle East investments include the real estate, mining, fintech and AI sectors. The broadening and deepening of activity by Asian banks, financial institutions, private credit and funds is also a key theme, says Dentons' Nicholson.

  In November 2024, for instance, Singapore's First APAC Fund VCC signed an MoU to invest up to AED5bn ($1.3bn) in Dubai-based AMIS Development, which will use the investment to “further expand its growth, both locally and internationally by growing its land bank, project pipeline, global brand partnerships, project team and investments in technology”.

  Earlier in May, Abu Dhabi-based agri-food and technology company Silal and Shouguang Vegetable Industry Group (SVG), a Chinese company specialising in vegetable seed breeding and counter-seasonal production, signed a strategic partnership agreement enabling SVG to invest over AED120m in the development of a 100,000 square-metre agricultural technology joint venture in Al-Ain.

  Asia-based banks are also providing support or lending to local banks, or to local branches of international banks, to boost the liquidity of the lenders amid the GCC's real estate and construction boom – particularly in Saudi Arabia.

  While it is not unusual for banks to lend to one another, the scale of the project financing needed is significant, according to a senior financial adviser specialising in Saudi projects. Indeed, it is "so staggering that it is impossible to assume that local banks will not have to face liquidity issues going forward", he says.

  He adds that some in the kingdom are looking at bringing back export credit agency financing to help de-risk major infrastructure projects and assets, noting that liquidity injection by international banks, including those headquartered in Asia, will help support the delivery of Saudi Arabia's Vision 2030 projects.

  Trade trends

  According to Asia House, the economic diversification programmes of Gulf countries are driving non-oil growth, creating opportunities for Asian firms in the areas of construction, infrastructure, technology, sustainability and financial services.

  "The Gulf states’ economic and social reforms continue at pace, attracting Asian investment, firms and talent," the think tank says.

  "New air routes between the Gulf and Asia will boost tourism and business connectivity," it continues. "For these reasons, Gulf-emerging Asia trade will keep growing and is on track to reach $682bn by 2030 if it continues at the 7.1% average annual growth rate seen between 2010 and 2023."

  A 2023 dip in trade affected key Gulf-Asia bilateral partnerships. Saudi-China trade fell 7.6%, while UAE-China trade fell by 15.5% in 2022-23. Nonetheless, both countries’ relationships with China have deepened and grown more strategic.

  In 2023, Saudi Arabia and the UAE were invited to join the Brics group of emerging economies, which originally comprised Brazil, Russia, India, China and South Africa, bringing them closer to Chinese decision-making at a global level.

  Shared prosperity

  The recent deals that Trump signed in Riyadh, Doha and Abu Dhabi have complicated predictions about when Gulf-Asia investments coud equal or surpass those with the US or broader West.

  However, by spreading their investments across key geographies and sectors in recent years, the Gulf states have been able to secure steady returns, sustain growth and make progress on their sustainability goals.

  Asian nations and sovereign funds are now adopting a similar approach – albeit on a varying scale – to pursue the same objectives.

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  Jennifer Aguinaldo
• 
  Kuwait seeks firms for 500MW solar project

  21 May 2025

  Kuwait’s Ministry of Electricity, Water & Renewable Energy (MEWRE), through the Kuwait Authority for Partnership Projects (Kapp), has invited interested firms to prequalify for a contract to develop zone two of the third phase of its Al-Dibdibah power and Al-Shagaya renewable energy project.

  The zone two solar photovoltaic (PV) project will have a net capacity of 500MW, roughly one-half the capacity of the zone one project.

  The Al-Dibdibah Power and Shagaya Renewable Energy Phase 3 Zone 2 project is located within the administrative boundary of Kuwait's Jahra Governorate, west of Kuwait City.

  The selected developer or developer consortium will design, finance, construct, maintain and transfer the 500MW solar independent power project (IPP).

  MEWRE and Kapp expect utility developers to submit their statements of qualifications by 24 July.

  It will sign a 30-year power-purchase agreement with MEWRE, and export the output to Kuwait's national electricity grid and transmission network.

  Similar to the 1.1GW Zone 1 project, London-headquartered consultancy firm EY and legal advisory firm DLA Piper and Norwegian engineering services firm DNV are advising the client for the Zone 2 solar IPP.

  MEED reported in April that MEWRE and Kapp could issue the request for proposals (RFPs) for the Al-Dibdibah Power and Shagaya Renewable Energy Phase 3 Zone 1 solar PV plant project before the summer.

  An industry source told MEED at the time that the tender documents were awaiting final approval before they were released to the market.

  MEWRE prequalified six consortiums and companies that can bid for the 1,100W Al-Dibdibah Power and Shagaya Renewable Energy Phase 3 Zone 1 contract, MEED reported in August last year.

  The consortiums and companies that have been prequalified to bid for the contract are:

  • Acwa Power (Saudi Arabia) / Alternative Energy Projects Company (local)
  • Trung Nam Construction (Vietnam)
  • EDF Renewables (France) / Abdullah Al-Hamad Al-Sagar & Brothers Company (local) /  Korean Western Power Company (Kowepo, South Korea)
  • Jinko Power (Hong Kong) / Jera (Japan) 
  • Abu Dhabi Future Energy Company (Masdar, UAE) / Fouad Alghanim & Sons General Trading Contracting Company (local)
  • TotalEnergies Renewables (France)

  The 1,100MW solar PV IPP project is also located in the Jahra governorate. Kapp issued the request for qualifications for the contract in January 2024.

  2030-50 strategy

  Kuwait aims to have a renewable energy installed capacity of 22,100MW by 2030 as part of the 20-year strategy that was announced in March last year and which ends in 2050.

  Minister of Electricity, Water & Renewable Energy, Salem Falah Al-Hajraf, confirmed that the strategy also involves installing distributed or rooftop solar farms, with the state procuring the energy output from solar PV farms.

  Kuwait aims to reach net-zero carbon emissions by 2060.

  https://image.digitalinsightresearch.in/uploads/NewsArticle/13923260/main.jpg

  Jennifer Aguinaldo
• 
  Oman prequalifies seven for Misfah and Duqm power plants

  21 May 2025

  Oman’s Nama Power & Water Procurement Company (Nama PWP) has qualified seven firms that can bid for a contract to develop and operate a gas-fired independent power producer (IPP) project in the sultanate.

  The Misfah and Duqm combined-cycle gas turbine plants will have a combined capacity of 2,400MW and will be tendered as one contract, a source close to the project previously told MEED. 

  The utility developers that have been prequalified to bid for the contract are: 

  • Acwa Power (Saudi Arabia)
  • Korea Western Power Company (Kowepo, South Korea)
  • Marubeni Corporation (Japan)
  • Nebras Power (Qatar)
  • Sembcorp Utilities (Singapore)
  • Shenzhen Energy Group Company (China)
  • Sumitomo Corporation (Japan)

  Located in Wilayat Bousher in Muscat Governorate, the Misfah IPP will have a design capacity of 1.6GW, costing approximately RO590m ($1.53bn).

  The Duqm IPP, to be located in the Duqm Governorate, will have a design capacity of 800MW, and will cost approximately RO290m ($753m).

  Both IPPs are expected to reach commercial operation by Q2 2029.

  Nama PWP invited interested firms to submit their prequalification applications for the project in January, with a deadline of 13 March.

  It received statements of qualifications (SoQs) from 12 firms, MEED reported in early April.

  The Misfah and Duqm IPPs will be implemented on a build, own and operate (BOO) basis.

  US/India-based Synergy Consulting is the client’s financial adviser.

  The new project represents a u-turn on a previous announcement that Oman would not build any new gas-fired power generation plants, which local media reported in 2022.

  In May last year, Nama PWP announced the award of renewed contracts for four gas-fired independent power and water projects (IWPPs) in the sultanate.

  The agreements collectively secured over 1,500MW of electricity and 200,000 cubic metres a day of desalinated water for up to nine years.

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  Jennifer Aguinaldo
• 
  Dewa starts MBR Solar Park phase seven prequalifications

  20 May 2025

  

   

  State utility Dubai Electricity & Water Authority (Dewa) has issued the request for prequalifications to companies interested in bidding for a contract to develop the next phase of the emirate's Mohammed Bin Rashid Al-Maktoum (MBR) Solar Park.

  The planned seventh phase of MBR Solar Park will include a 1,600MW solar photovoltaic (PV) plant and a 1,000MW battery energy storage system (bess), providing up to six hours of storage.

  According to a source close to the project, Dewa expects to receive statements of qualifications by the end of June.

  MEED understands that 47 firms submitted their responses to Dewa’s expression of interest (EoI) request for the contract on 21 March.

  International and regional utility developers; engineering, procurement and construction contractors; and bess suppliers attended an investor roadshow for the project on 9 April, as MEED reported.

  French utility developer Engie; Riyadh-headquartered Acwa Power and Alfanar; and the local Amea Power, Etihad Water & Electricity Company and Abu Dhabi Future Energy Company (Masdar) were among those that attended the investor roadshow last month.

  Dewa issued the EoI request for the contract in February.

  The project is expected to be commissioned in phases, starting in August 2027.

  In January, Dewa selected a transaction advisory team for the project, comprising UK-headquartered Deloitte and US-based CMS and Sargent & Lundy as financial, legal and technical advisers, with Deloitte acting as lead adviser. 

  In February last year, Dewa and Masdar reached financial close for the 1,800MW sixth phase of MBR Solar Park, which is expected to cost up to AED5.5bn ($1.5bn).

  Once completed in 2026, the sixth phase will increase the solar park’s total production capacity to 4,660MW.

  Dewa recently increased its flagship solar project's 2030 installed capacity target by 45%, from 5,000MW to 7,260MW.

  The state utility said MBR Solar Park will have a production capacity of more than 7,260MW by 2030, with a total investment of AED50bn ($13.6bn).

  According to Dewa, the total capacity of the solar energy projects commissioned at the solar park has reached 3,460MW from PV solar panels and concentrated solar power.

  Based on this figure, clean energy accounts for 20% of Dewa's total power capacity of about 17,179MW as of early 2025. Natural gas-fired capacity accounts for the rest.

  The Dubai Clean Energy Strategy 2050 and the Dubai Net-Zero Carbon Emissions Strategy 2050 aim to provide 100% of Dubai's energy production capacity from clean energy sources by 2050.

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  Jennifer Aguinaldo