Supreme Petroleum Council Approves ADNOC’s 2030 Strategy and Five Year Business Plan Focused On Growth And Maximising Value
The strategy will ensure ADNOC’s long-term success in an evolving energy market. It will also further strengthen ADNOC’s role as a major contributor to the United Arab Emirates’ future development and economic diversification objectives, with a clear focus on delivering more valuable and profitable upstream and downstream businesses, while ensuring an economic and sustainable supply of gas, in line with the Abu Dhabi leadership’s directives.
H.H. Sheikh Mohamed bin Zayed affirmed ADNOC has the unwavering support of UAE President His Highness Sheikh Khalifa bin Zayed Al Nahyan for ADNOC’s revitalized Vision, which aims to drive the UAE’s engines of prosperity, by unlocking the full potential of its natural and human resources. H.H. Sheikh Mohamed bin Zayed said ADNOC’s key role in the prosperity of Abu Dhabi would be strengthened by the new strategy and sound five-year business plan, which will enable ADNOC to maximise value by leveraging synergies, implementing efficiencies, and making targeted investments in new growth opportunities.
He added the strategy and five-year plan will build on the foundations laid in the past eight months, during which ADNOC embarked on a journey to evolve into a more agile and resilient company that is strategic, commercially minded and performance driven. The company’s focus on people, performance, profitability and efficiency, he said, is already delivering tangible results.
The SPC is the highest governing body of the oil and gas industry in Abu Dhabi. The Council formulates and oversees the implementation of Abu Dhabi's petroleum policy and follows up its implementation across all areas of the petroleum industry to ensure that the set goals are accomplished.
The other SPC members attending the meeting, at ADNOC’s new headquarters, were HH Sheikh Hazza bin Zayed Al Nahyan, Vice Chairman of the Abu Dhabi Executive Council; HH Sheikh Mansour bin Zayed Al Nahyan, Deputy Prime Minister and Minister of Presidential Affairs; HH Sheikh Hamed bin Zayed Al Nahyan, Chairman of the Court of Abu Dhabi’s Crown Prince; HH Sheikh Mohammed bin Khalifa bin Zayed Al Nahyan, member of Executive Council of Abu Dhabi; HH Sheikh Dhiyab bin Mohamed bin Zayed Al Nahyan; His Excellency Suhail Mohammed Al Mazrouei, UAE Energy Minister, HE Dr Sultan Al Jaber, Minister of State and ADNOC Group CEO; HE Hamad Mubarak Al Shamsi, Secretary-General of the SPC; HE Dr Ahmed Mubarak Al Mazrouei, Secretary General of the Executive Council; HE Khaldoun Al Mubarak, CEO and Managing Director of Mubadala; HE Riyad Abdul Rahman Al Mubarak, Chairman of the Abu Dhabi Department of Finance and member of the Abu Dhabi Executive Council; HE Abdulla Bin Mohammed Bin Butti Al Hamed, Chairman of the Abu Dhabi Energy Authority and member of the Abu Dhabi Executive Council; HE Abdullah Nasser Al Suwaidi, and HE Suhail Faris Ghanem Al Mazrouei.
H.E. Dr Al Jaber said: “His Highness Sheikh Mohamed bin Zayed, and the SPC’s, approval of our 2030 strategy and five-year business plan are momentous milestones in our evolution into an agile, resilient and commercially focused organization, that is able to adapt and maintain its competitive edge in today’s changing energy landscape.
“We will make strategic, commercially viable and targeted investments aimed at building on our legacy of success and ensuring our continued growth. In parallel, we will maintain our efforts to improve the organisation’s efficiencies and identify opportunities to further optimise our value chain.
“We will ensure the oil and gas needs of our domestic and international customers are met and also enhance our downstream and petrochemical businesses, to take advantage of growing demand for higher value products. Our ultimate goal is for ADNOC to remain a key contributor to the UAE economy and a leading player in advancing the industry,’ H.E. Dr Al Jaber added.
“At the same time we aim to work more closely with our existing partners, while seeking new partnership opportunities to attract smart investments that will add tangible value to the UAE economy. We are keen to work with those who appreciate the value of long term collaboration that delivers mutual benefits.
“Meanwhile, everything we do will continue to be underpinned by an unwavering commitment to the highest standards of Health, Safety and Environment (HSE), and the integrity of our assets,” H.E. Dr Al Jaber emphasised.
Under the 2030 Strategy upstream will remain ADNOC's most profitable business. The strategy reaffirms ADNOC’s intent to achieve a production target of 3.5m bpd in 2018, an increase, over today’s production, of 400,000 bpd. There will also be a stronger focus on the application of new and innovative technologies for enhanced oil recovery and tapping into additional sour gas resources.
In line with increased sour gas production, ADNOC’s sulphur output will rapidly increase over the coming decade, making Abu Dhabi one of the world’s largest sulphur producer. As a result, ADNOC plans to maximize the value of its sulphur by working closely with key phosphate markets, while also supporting the development of a local sulphur products industry, including enhancing the existing ammonia and urea industry, with a new generation of advanced fertilizers.
In parallel with growing its crude production, the strategy is aimed at ensuring economical and sustainable gas supplies, as part of its fully integrated Gas Master Plan. The plan will facilitate ADNOC’s commitment to provide the gas necessary to meet Abu Dhabi’s growing demand. It has also embarked on a gas price restructuring exercise that will ensure a competitive price for its gas.
Downstream, ADNOC will focus on integrating its refining and petrochemicals business to capitalise on synergies to enhance profitability. It will grow domestic refining and petrochemical capacity, through focused investments in new projects, including gasoline and aromatics production and additional polyolefin capacity.
ADNOC aims to stretch the margin of each refined barrel of oil. Gasoline production will increase to 10.2 mtpa by 2022 to maintain Abu Dhabi’s self-sufficiency, with the new gasoline and aromatics project adding 4.2 mtpa of gasoline supply and 1.4 mtpa of aromatics in 2022. Petrochemical production will grow from 4.5 mtpa in 2016 to 11.4 mtpa by 2025. The expansion will add polyolefin capacity and new petrochemical products coming from a world scale mixed feed liquid cracker.
As part of ADNOC’s focus on creating greater efficiencies, the organization will introduce group wide procurement that will simplify the process of doing business with ADNOC, create greater understanding of ADNOC’s requirements and allow the group to optimise expenditure. One single entity for registration and prequalification will eliminate duplication of efforts, reduce cycle time and improve efficiency, by eliminating repetitive tendering for the same goods and services.
To benchmark its performance, ADNOC has rolled out a fully integrated balanced scorecard approach across the group, aligned to Key Performance Indicators. And, to ensure meritocratic and fair employee performance management, ADNOC will link individual performance to clear business objectives.
In support of its plan to develop world class talent, ADNOC has enhanced its HR recruitment strategy and training to ensure it continues to be an employer of choice. It will introduce an HR master plan and integrated manpower planning across the group, linking recruitment to the business strategy, while at the same time raising the bar through a competency based performance management system. Young talent will also spend less time in the classroom and more time in the field to gain hands on experience.
ADNOC will also create a more robust leadership pipeline, providing future leaders with the right visibility and exposure across the entire group. Bespoke leadership programmes will address the group’s business needs and an ADNOC leadership style will be created, based on common leadership behaviours. A more robust youth development programme will be designed to provide greater on the job training and mobility opportunities for new talent. These programmes will be supported by a lifelong learning culture, providing a mix of hands on experience and coaching, in addition to structured training.
Prior to the SPC meeting, H.H. Sheikh Mohamed bin Zayed officially inaugurated the new ADNOC headquarters. He was accompanied by HH Sheikh Hazza bin Zayed Al Nahyan, Vice Chairman of the Abu Dhabi Executive Council; HH Sheikh Mansour bin Zayed Al Nahyan, Deputy Prime Minister and Minister of Presidential Affairs; HH Sheikh Hamed bin Zayed Al Nahyan, Chairman of the Court of Abu Dhabi’s Crown Prince; HH Sheikh Mohammed bin Khalifa bin Zayed Al Nahyan, member of Executive Council of Abu Dhabi; HH Sheikh Dhiyab bin Mohamed bin Zayed Al Nahyan.
H.H. Sheikh Mohamed bin Zayed said the new headquarters underlines ADNOC’s importance as a critical pillar of the Abu Dhabi economy. During the visit, His Highness visited floors in the building that have been specifically designed to stimulate creativity and critical thinking, in a nurturing and supportive environment, that inspires people to innovate, and deliver results. He also visited regular business floors, which are designed to facilitate dialogue and communication throughout the day amongst team members.
H.E. Dr Al Jaber said: “Our new headquarters is a reflection of the strategic changes taking place within ADNOC, as we evolve into a more commercially minded and performance driven organization. Our new offices will help energize our new culture, which is underpinned by teamwork, exceeding expectations and achieving the highest levels of excellence to ensure our long-lasting success.”