The Abu Dhabi National Oil Company (ADNOC) will receive a $3 billion loan from Japan to boost its upstream business.
This will be ADNOC’s third loan from Japan after it was granted $3 billion in 2007 and 2010 to boost its oil supply capacity to ensure stable oil exports to Japan, according to Reuters.
The deal, which coincides with Japanese Trade Minister Toshimitsu Motegi’s visit to Saudi Arabia, is set to be signed in the UAE on Sunday by the Japan Bank for International Cooperation (JBIC) and ADNOC.
Reuters also reported that the UAE is the second largest crude oil supplier to Japan after Saudi Arabia, and oil imports from UAE accounted for 21.7 percent of Japan’s total imports last year, averaging 793,000 bpd and the loan is to be extended by JBIC and three private banks, the Bank of Tokyo-Mitsubishi UFJ, Sumitomo Mitsui Banking Corp and Mizuho Corporate Bank.
A report by Platts has stated that the loan comes as Japanese oil companies are seeking renewals of their concessions in Abu Dhabi, it also said that Japan’s energy financing arm had signed a memorandum of understanding with ADNOC in December 2012 that called for “further strengthening of their comprehensive strategic partnership,” and the latest loan agreement is seen as a follow-up to that agreement.
