Abu Dhabi National Energy Co. (Taqa) is eyeing expansion into the Canadian power market as part of plans to more than double assets by 2012, the company’s chief executive said on Monday.
Taqa is 75% owned by the government of the emirate of Abu Dhabi, which controls over 90% of the oil reserves of the United Arab Emirates. The company is targeting $4 billion in acquisitions in the next year as it plays its part in Abu Dhabi’s drive to use record oil income to diversify.
“I hope to close on $4 billion more (acquisitions) in the next 12 months,” Chief Executive Peter Barker-Homek told Reuters.
That would take Taqa’s assets to $20 billion, he said. In the longer term, Taqa aims to boost its assets to between $40 billion and $60 billion by 2012.
The Canadian power sector is just one of many areas of expansion that Taqa is considering across the energy sector, Barker-Homek said.
“My understanding is that Canada is power-short, so we are examining areas where we might get into that,” he said.
Taqa bought Canada’s Northrock Resources for $2 billion in cash in May. Part of the attraction of Northrock’s Canadian upstream oil and gas assets was the proximity to the world’s largest energy consuming market in the United States, he said.
“Canada has a sympathetic relationship with U.S. demand, having gas and oil in that market and potentially power would put us in a nice demand centre,” he said.
Taqa was also considering assets in Europe, the Middle East, North Africa, India and Pakistan. The company has walked away from around $16 billion in potential deals so far this year, he said.
Taqa has plans to enter the biofuels and renewable energy sectors, Barker-Homek said.
Taqa wants to become an ethanol producer and hopes to make an announcement on this within the next two to three weeks, he said. He declined to give further details.
A wind farm deal is another that is on the table, he said.
“We hope to announce a reasonable sized (wind farm) deal soon.” Taqa is reviewing its land assets with an eye to building wind farms.
It is also planning a bio-fuels power generation plant in India, he said.
FOREIGN SHARES, DEBT
Taqa has no plans to open its shares to foreign ownership in the near future, but if and when it does there will be no limits on how much overseas investors can hold, Barker-Homek said.
“Potentially, up to 100 percent of the share capital could be held by anybody,” he said. At present, the company does not allow foreign shareholders. If it were to open up fully, it would be the first UAE company to have no restrictions at all on foreign ownership.
Barker-Homek said it would make sense for Taqa to open up at some point, but not for at least a year after the company had established a reputation.
“Today is certainly not the right time for opening up the share register,” he said. “We haven’t decided when it would make sense. We want to be blue chip. We will only demonstrate that in 2008 and beyond.”
On debt, Taqa has yet to decide when it will go ahead with plans for new issues. In June, Taqa said it would sell up to $9 billion of bonds over 5 years to finance expansion.
The company has appointed lead banks for an Islamic bond issue, but for this too it has no definite plans yet as to when it will launch, he said.
NETHERLANDS
A plan to store natural gas in the depleted onshore Bergermeer oilfield in the Netherlands to supply the European market will be up and running in 2008 or 2009, he said.
Taqa plans to import liquefied natural gas (LNG) to an offshore floating storage and regasification unit, before piping it onshore. LNG is gas chilled to liquid form for shipment on specially designed tankers.
It is also in talks to tie in Netherlands offshore fields to Norway’s pipeline system, he said.
Taqa is looking to get into the upstream LNG sector, he said.
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