XRG, the international energy investment platform launched by Adnoc in November 2024, has signed non-binding Heads of Terms to acquire a stake in Southern Gas Corridor (SGC) from the Ministry of Economy of Azerbaijan.

The agreement, signed on the sidelines of Adipec, serves as another milestone for the growing strategic energy relationship between UAE and Azerbaijan, reported WAM.

SGC, an Azerbaijani energy holding company, was established in 2014.

Its holdings include operating natural gas producing assets and a 3,500 km pipeline network from the Caspian, through Türkiye to southern Europe, with the current capacity to deliver up to 26 billion cubic metres per annum.

The agreement also has the potential to contribute to Azerbaijan’s economic growth while reinforcing the country’s role as a reliable partner.

The Heads of Terms were signed on the sidelines of Adipec by Dr Sultan Al Jaber, Minister of Industry and Advanced Technology, and Executive Chairman and CEO of XRG, and Mikayil Jabbarov, Minister of Economy of the Republic of Azerbaijan and Chairman of SOCAR’s Supervisory Board.

The agreement potentially expands XRG’s collaboration with SOCAR from gas production to the reliable delivery of energy resources to European markets seeking to diversify their sources of supply.

 XRG’s holdings in the Caspian currently include its strategic partnership with SOCAR in the Absheron gas and condensate field, with a 30 percent stake.

XRG also holds a 38 percemt interest in the offshore Block I gas concession in Turkmenistan.

SOCAR also acquired a 3 per cent interest in the SARB and Umm Lulu concession in Abu Dhabi from ADNOC in May 2024.

Southern Gas Corridor is a Closed Joint-Stock Company owned by the Ministry of Economy of the Republic of Azerbaijan and the State Oil Company of the Republic of Azerbaijan (SOCAR).

The company’s assets include a participating interest in the Shah Deniz gas and condensate field, the South Caucasus Pipeline, the Trans Anatolian Pipeline, the Trans Adriatic Pipeline and shares in Azerbaijan Gas Supply Company.