XRG, Adnoc's international energy investment unit, has completed the deal to buy a stake in the Southern Gas Corridor, which positions the Abu Dhabi company to expand operations in the Caspian region.
The company has received all regulatory approvals for the equity shareholding it has bought from Azerbaijan’s Ministry of Economy, XRG said on Tuesday.
It did not give financial details of the deal, which was first announced in November.
Consisting of pipelines and gasfields, the Southern Gas Corridor runs for about 3,500km from the Azerbaijani sector of the Caspian Sea through Georgia and Turkey into Southern Europe.
XRG assets include interests in the Shah Deniz natural gas-condensate field in Azerbaijan, the South Caucasus Pipeline from the Caspian Sea to Turkey, the Trans Anatolian Pipeline that runs from the Turkey-Georgia border to the Turkey-Greece border and the Trans Adriatic Pipeline, as well as shares in Azerbaijan Gas Supply Company.
Critical corridor
The corridor has a capacity to deliver up to 26 billion cubic meters of natural gas annually and is critical for supply to Southern Europe.
Closure of the Strait of Hormuz because of the Iran war has heightened the importance of the Southern Gas Corridor, as gas supplies from Qatar to global markets have plummeted.
Europe is meanwhile looking to cut its dependence on Russian gas as the Ukraine war continues and is looking for alternative supplies.
“The completion represents a major milestone in XRG’s strategy to build an integrated and resilient gas position across the Caspian region,” XRG said.
XRG is “helping to connect high-quality Caspian resources with established routes to growing regional and European markets” through its interests in export infrastructure, as well as upstream investments in Azerbaijan, it added.
Founded in 2024, XRG is an international low-carbon energy and chemicals investment company, with an enterprise value exceeding $80 billion.
The company has been investing across continents to expand operations. It plans to double its asset value over the next decade, capitalising on energy transition, the growth of artificial intelligence and the rise of emerging economies.
Caspian expansion
XRG has been expanding across the Caspian region and now has a 30 per cent interest in the Absheron gas and condensate field in Azerbaijan, as well as a 38 per cent stake in the offshore Block I gas and condensate concession site off Turkmenistan.
“By combining world-class gas resources in Azerbaijan and Turkmenistan with strategic export infrastructure, we are building a resilient platform that connects advantaged supply with growing regional and European demand,” Mohamed Al Aryani, President of International Gas at XRG, said.
XRG has also entered Venezuela as part of its global expansion. Last month, it received a licence for the development of an offshore natural gas project in the South American nation alongside BP and Qatar’s UCC.
