The UAE’s ADNOC seeks to enter the energy market in Venezuela, to expand the scope of its business in the field of natural gas, in light of the rapid geopolitical changes taking place in South America after Washington’s arrest of Venezuelan President Nicolas Maduro.
According to a report published by Bloomberg, based on undisclosed sources, ADNOC is closely monitoring developments in Venezuela and expressing its interest in forming strategic partnerships with major international companies to exploit emerging investment opportunities there.
This interest comes after US President Donald Trump announced his intention to benefit from Venezuela’s vast oil reserves, estimated at more than 300 billion barrels of fixed oil, making it one of the largest oil exporting countries in the world if political stability is achieved.
However, interest remains in its initial stages, and depends mainly on establishing stable legal and financial structures that allow investment in this resource-rich country, as the report explained. The arrest of Maduro opened the door to the restructuring of the Venezuelan energy market, and Washington witnessed the sale of the first shipment of Venezuelan oil worth $500 million, according to a report published by CNN yesterday, Thursday, based on an American administration official whose name was not announced.
This deal represents a first step towards reintegrating Venezuela into global markets, after years of international sanctions that limited the export of its oil.
ADNOC will try to enter the Venezuelan market through its international investment arm, XRG, which is a key vehicle for expanding investments outside the UAE, as reported by Bloomberg.
In the context of its accelerated international investment activity, last December, XRG acquired 95% of the German company Covestro, one of the largest producers of chemicals and polymeric compounds in Europe, in a deal valued at billions of dollars. ADNOC is also currently in talks with the German government to acquire the gas trading unit of Berlin-based Sefe, strengthening its position as a major player in the European gas market amid the ongoing energy crisis.
