JEDDAH: The Abu Dhabi National Oil Co. (ADNOC) for Distribution is planning fuel distribution assets in Saudi Arabia, the company announced in a statement to the Abu Dhabi Securities Exchange on Monday.
ADNOC Distribution’s board of directors will hold a meeting on Dec. 30 to discuss purchasing fuel distribution assets valued at SR37.5 million ($10 million), the statement said.
The company obtained a license to own, operate and manage fuel stations across Saudi Arabia in 2018, and opened two initial service stations along the Riyadh-Dammam highway and in the city of Hofuf in Al-Ahsa governorate that same year.
Following the initial success of the stations, which saw profits of over 30 percent, last year the company said it intended to expand its operations in Saudi Arabia and add additional activities such as car wash and dining facilities.
The UAE company has been actively looking for growth opportunities abroad for its diverse range of business sectors.
ADNOC Distribution revealed in its 2020 third-quarter report results that its Saudi expansion has been progressing well, and it is in advanced discussions to finalize land leases in the Kingdom.
“We see the Saudi Arabian fuel market as large and fragmented with underdeveloped customer offerings,” ADNOC said in its Q3 Management Discussion and Analysis Report for 2020.
“We believe that ADNOC Distribution’s experience and strengths can be leveraged to introduce world-class fuel station and customer service standards in Saudi Arabia to capture growth.”
ADNOC Distribution, a subsidiary of the ADNOC Group, was established in 1973. It is the UAE’s largest fuel retailer energy company owned by the emirate of Abu Dhabi, and operates across the hydrocarbon value chain, including exploration, production, storage, refining, marketing and distribution.