Countries of the Gulf which have been hit hard by low oil prices are continuing their recovery to pre-pandemic levels. Abu Dhabi based Adnoc Logistics & Services (ADNOC L&S) recently signed a joint venture (JV) with China’s Wanhua Chemical Group to create a new shipping company called AW Shipping limited.
The new company will be operating a large fleet of modern gas and product tankers. Wanhua’s value lies in its ability to process raw petrochemical into commercial products whereas ADNOC has the distribution network. The main purpose of the JV is to optimize and lower the price of transporting liquified petroleum gas (LPG) from suppliers all over the world to Wanhua’s manufacturing plants for refining.
ADNOC operates and owns the largest cargo fleet in the UAE. Following the signing of a 10-year LPG contract with Wanhua, ADNOC has moved over 20 million metric tonnes of various oil and gas products. LPG’s growing usage in many EM countries, especially India, for various purposes from domestic to industrial continues to create demand. The creation of a gas transporting network between China and UAE further signals a growing demand for LPG products to fuel the next decade of technological development across the regions these two countries serve.