GIC pays $600m to join KKR and BlackRock in Abu Dhabi pipelines

The investment by the Singaporean SWF brings the total invested in the pipelines by the trio and an Abu Dhabi pension to $4.9bn.

Singapore’s sovereign wealth fund GIC has invested $600 million in oil pipelines in Abu Dhabi, becoming a shareholder alongside KKR and BlackRock.

GIC has become shareholder in a subsidiary holding 18 pipelines transporting oil in the emirate, with a concession length of 23 years. KKR and BlackRock made an initial investment earlier this year, alongside the Abu Dhabi Retirement Pensions and Benefits Fund, totalling $4.3 billion.

The addition of GIC will see it take a 6 percent stake in the consortium, with KKR and BlackRock jointly holding 40 percent and the ADRPBF owning 3 percent. The remainder is owned by the Abu Dhabi National Oil Company, which will retain the management of the pipelines.

“The overall agreement is testimony to the global investment community’s positive view on the attractiveness of both the UAE’s long-term potential, as well as the quality of ADNOC’s substantial infrastructure asset base,” said Ahmed Jasim Al Zaabi, group director, finance and investment at ADNOC, in a statement.

According to a source, ADNOC is thought to be contemplating similar moves in the downstream, midstream and upstream sectors. It recently signed MoUs with Indonesian national energy company Pertamina and China National Offshore Oil Corporation to explore such opportunities in each others’ countries.

The investments by KKR and BlackRock were made through the KKR Global Infrastructure Investors III fund and BlackRock’s Global Energy & Power Infrastructure Fund III.

As was the case with KKR and BlackRock earlier in the year, GIC’s investment represents its first infrastructure asset in the Middle East. Its portfolio also includes an 11.2 percent stake in London’s Heathrow Airport and a stake in Indian renewables group Greenko Energy.

Click here to see which other fund managers have raised vehicles targeting the Middle East.

Eduard Fernandez contributed to this story.