XRG, a subsidiary of Abu Dhabi National Oil Company (ADNOC) that brings together Abu Dhabi Development Holding Company (ADQ) and global investment firm Carlyle, has signed a preliminary Heads of Terms agreement to acquire a stake in Southern Gas Corridor CJSC (SGC) — the company responsible for transporting Azerbaijani gas from the Caspian Sea to European markets.
According to Offshore Energy, the agreement was signed by Dr. Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology, Executive Chairman and CEO of XRG, and Mikayil Jabbarov, Minister of Economy of the Republic of Azerbaijan and Chairman of SOCAR’s Supervisory Board.
Southern Gas Corridor CJSC is a closed joint-stock company owned by the Ministry of Economy of Azerbaijan and the State Oil Company of the Republic of Azerbaijan (SOCAR). Its assets include producing gas fields and a 3,500-kilometer pipeline network linking the Caspian coast with Türkiye and Southern Europe, with a current annual transmission capacity of up to 26 billion cubic meters of gas.
Experts view this deal as a significant step toward strengthening the strategic energy partnership between the UAE and Azerbaijan. It is expected to stimulate Azerbaijan’s economic growth while reinforcing the country’s position as a reliable energy supplier for Europe.
For ADNOC and XRG, the agreement paves the way to expand cooperation with SOCAR — from gas production to the delivery of energy resources to European markets. XRG already holds a 30% stake in the Absheron gas and condensate field and a 38% interest in the offshore Block I in Turkmenistan. In return, in May 2024 SOCAR acquired a 3% stake in the SARB and Umm Lulu concessions in Abu Dhabi.
SGC’s asset portfolio includes stakes in the Shah Deniz gas and condensate field, the South Caucasus Pipeline, the Trans Anatolian Pipeline (TANAP), the Trans Adriatic Pipeline (TAP), and shares in the Azerbaijan Gas Supply Company.
This agreement follows XRG’s withdrawal of its $18.7 billion non-binding indicative offer to acquire Australian energy company Santos.
