Abu Dhabi Looks Beyond Oil

Its enormous state energy company isn’t doing an Aramco-style IPO, but it isn’t standing still, either

- James E. Ellis

Behind the 65-story glass tower that houses the shiny new headquarters of Abu Dhabi National Oil Co. sits a remnant of the Middle Eastern emirate’s not-so-distant past: the squat, sand-colored building that the government-owned energy giant once called home.

The stark contrast between the old and new buildings provides a hint of the changes afoot in energy- rich Abu Dhabi. The tiny, but stratospherically wealthy, emirate is trying to forge an economy for a post-oil world and needs to wring more profits from its petroleum industry to finance the makeover.

A similar shift is taking place in neighboring Saudi Arabia, where Adnoc’s larger rival, Saudi Aramco, plans to sell shares for the first time. With a projected $2 trillion valuation, Aramco is set to have the world’s biggest initial public offering. Adnoc also wants to secure an economic future for its government owner after the hydrocarbons run out, but it’s treading a different path. “Adnoc has always been seen as a stodgy, slow-moving company,” says Robin Mills, chief executive officer of consultant Qamar Energy. “Now they’re striving to set up a strategy and actually implement it. It’s still a work in progress.”

The man in charge of revamping Adnoc and managing its 50,000 employees is Sultan Al Jaber, who became CEO in 2016. His effort has an existential urgency, because Abu Dhabi—like Saudi Arabia—offers something the world apparently has too much of: oil. The boom first fell in 2014, when the price of crude plunged by more than half, breaking a string of $100-per- barrel years that had engorged budgets and bred complacency across the Gulf.