ADNOC Gas Q2 Profit Falls 52% to $665M; Awards $8.2B in Rich Gas Contracts

Second-quarter net profit at ADNOC Gas was $665 million, down 52 percent from a year earlier. That landed above its guidance range of $400 million to $600 million. Revenue was $3.624 billion, a 39 percent decline. EBITDA fell 47 percent to $1.194 billion.

The quarterly report arrived Monday with the Strait of Hormuz still disrupted. The waterway stayed closed for the whole quarter, and ADNOC Gas attributed most of the EBITDA decline to high-margin export volumes lost because of the disruption. Reduced export sales volumes and weaker price realizations in the ETL and ALNG joint venture drove the net profit drop. The company said it still met domestic customer requirements.

Half-year and cash flow

Across the first six months, revenue fell 28 percent to $8.6 billion. H1 EBITDA dropped 32 percent to $3 billion. H1 net profit declined 34 percent to $1.7 billion. Q2 capital expenditure was $983 million, up 48 percent from $665 million in the same quarter last year. Free cash flow, excluding working capital changes, was $260 million. ADNOC Gas ended the quarter with cash of $1.5 billion. The board approved a dividend of $940 million for the quarter, payable in September 2026. The dividend policy calls for 5 percent annual growth through 2030.

Outlook

ADNOC Gas expects Q3 net income of $600 million to $800 million. That forecast assumes continued disruption to maritime routes through the Strait of Hormuz.

Rich Gas Development

ADNOC Gas also made final investment decisions on Phases 2 and 3 of the Rich Gas Development Project, awarding $8.2 billion in engineering, procurement and construction contracts. Phase 2 went to Wison Engineering for $3.9 billion and includes a new natural gas processing train at Habshan. Phase 3 went to Tecnimont for $4.3 billion and includes a new natural gas liquids fractionation train at Ruwais.

Those projects sit behind a revised growth target. ADNOC Gas now wants EBITDA 60 percent higher by 2030 compared with 2023, up from an earlier goal of more than 40 percent growth between 2023 and 2029. To fund that, it expects to invest roughly $28 billion between 2026 and 2030. CEO Fatema Al Nuaimi said the investments would expand processing and export capacity, unlock shareholder value, and put ADNOC Gas at the heart of the UAE's energy future. Forbes Middle East ranks ADNOC Gas sixth on its list of the region's 100 most valuable companies.

Spending and payout

The tension in the numbers is hard to miss. Quarterly capital expenditure of $983 million ran well ahead of the $260 million free cash flow, and the $940 million dividend is bigger than the Q3 profit range ADNOC Gas has set for itself. The company is betting that the disruption pauses before its spending does.