Good morning, friends, and happy ADIPEC week. Today’s issue touches every corner of our beat: the money behind the assets, the gas under the sand, the oil in storage, the jets on lease, and the rails still being laid.
We lead with who’s lending: Chinese banks have become a regular source of debt for Gulf energy majors, from QatarEnergy and Aramco to Adnoc and Acwa Power. The analysts we spoke to say the borrowers are choosing it, for the pricing and for the extra set of lenders.
Adnoc is working both ends of the gas trade: It has taken FID on Ruwais Diyab, its first large-scale unconventional gas project, which would cover about a fifth of the UAE’s gas supply gap from 2029. Adnoc Gas also signed a five-year agreement to supply up to 1.6 mn tons of LNG to TotalEnergies.
At ADIPEC, Al Jaber says the world has run down its oil buffers: He wants bigger strategic reserves, and Gulf producers are already building them in Asia. The World Bank expects stocks to keep falling, with global oil supply set to drop 5.2% this year, its steepest fall in more than four decades outside the 2020 recession.
Our favorite number of the morning: 11. That’s how many years Airbus and Boeing’s combined order backlog now stretches, which helps explain why Adia is buying into USD 1.4 bn of Avolon jets that are already flying.
What we’re watching this week: ADIPEC runs through Thursday, and GCC transport ministers meet in Bahrain on Sunday to sign the rail connectivity agreement for the 2.1k km line from Kuwait to Muscat. Trains aren’t due to run until end-2030, so there’s plenty of time to pack snacks.
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Power Trip’s final issue turns to the people paying the bill. We look at the cost of a backup generator or going solar, how your electricity bill is really calculated and whether the price is right, whether an EV pays off against a petrol car today, and why green energy keeps skipping the consumer.
Why would a Gulf energy major borrow USD 3 bn from four Chinese banks? Because the price is right and a second set of lenders is worth having, analysts tell EnterpriseAM, and the borrowers’ balance sheets earn them narrow margins. The list of Gulf borrowers is growing: QatarEnergy has secured USD 3 bn from four Chinese banks, joining Aramco, Saudi Electricity Company, Acwa Power, and Adnoc, whose gas developments, electricity networks, and renewable projects now draw Chinese capital.
Strong balance sheets and state links make Gulf energy majors attractive borrowers. They can secure favorable financing terms, infrastructure finance expert Ajay Pratap S. Hari tells us, and borrowing doesn’t necessarily signal financial trouble. When debt is available at a narrow margin, retaining money can be more advantageous than financing every investment internally. Companies can preserve reserves for capital expenditure, existing commitments, and future disruptions without materially weakening their balance sheets, he adds.
Spreading funding across lenders keeps capital available if markets deteriorate. Even companies holding substantial reserves have reasons to use debt when they are financing large developments and managing unpredictable export revenues, Alicia García-Herrero, chief economist for Asia Pacific and the Middle East at Natixis, tells EnterpriseAM. QatarEnergy’s new facility is for general working capital, meaning day-to-day funding, while two Ras Laffan trains are offline and export revenues are uncertain. Companies such as QatarEnergy and Aramco can spread their funding requirements across internal resources and external lenders.
The lenders’ case
Chinese banks have cheap funding and fewer good borrowers at home. Monetary easing has given Chinese lenders relatively cheap funding, while weak domestic credit demand and prolonged difficulties in the property sector have reduced attractive lending prospects at home, Hari tells us. The Gulf offers creditworthy, often state-linked borrowers and substantial demand for financing across hydrocarbons, renewables, and digital infrastructure, which makes it an attractive destination even amid the conflict, he argues.
Gulf energy loans offer risk-adjusted returns and diversification: Gulf energy and infrastructure companies give Chinese institutions attractive risk-adjusted returns and a way to diversify their loan portfolios away from domestic property-sector pressures and exposure to US markets, García-Herrero adds. Chinese banks are therefore pursuing commercial returns alongside Beijing’s wider economic interests.
The largest Chinese state-owned banks can join multi-bn transactions at competitive margins. Pricing and lending capacity are the clearest advantages, Hari argues.
Two recent five-year Gulf loans were priced at 50 and 75 basis points above SOFR. QatarEnergy’s facility, from Bank of China, Industrial and Commercial Bank of China (ICBC), Agricultural Bank of China, and China Construction Bank Asia, carries the 50, and QNB secured a separate USD 2.5 bn syndicated loan at the 75, with 25 international and regional institutions, including nine Asian banks that committed around USD 1.3 bn. The gap points to competitive pricing for QatarEnergy, although the two borrowers have different credit profiles and the loans aren’t directly comparable.
A look at the numbers: QatarEnergy’s five-year facility carries a margin of SOFR plus 50 basis points. Qatar National Bank (QNB), meanwhile, secured a separate five-year USD 2.5 bn syndicated loan at SOFR plus 75 basis points, Bloomberg reported. QNB’s financing brought together 25 international and regional institutions, including nine Asian banks that committed around USD 1.3 bn. The difference illustrates QatarEnergy’s competitive pricing, although the two borrowers have different credit profiles and the loans aren’t directly comparable.
Gas, power, solar
Four Chinese state-owned lenders supplied about USD 3.7 bn of the financing tied to Aramco’s USD 11 bn Jafurah midstream lease-and-leaseback transaction, Reuters reported. Bank of China, ICBC, and China Construction Bank each contributed around USD 1 bn, and Agricultural Bank of China roughly USD 750 mn.
Chinese lenders entered Jafurah through debt, and the equity consortium is US-led. Chinese investment funds stayed out of the equity amid US-China trade tensions, even as Chinese lenders took part in financing the transaction. The consortium, led by BlackRock’s Global Infrastructure Partners, acquired a 49% interest in Jafurah Midstream Gas Company, and Aramco retained 51%, so Chinese institutions financed the Saudi gas assets without joining the American-led equity investment.
Saudi Electricity Company secured a USD 3.6 bn syndicated loan in December 2024, with five Chinese lenders among 13 banks. The others come from Germany, India, the UAE, Kuwait, and Saudi Arabia, according to a Tadawul disclosure. The unsecured facility has a five-year term, extendable by another two years, and is for general corporate purposes.
Acwa Power, Badeel, and Saudi Aramco Power CompanysecuredUSD 5.9 bn in senior debt that includes four Chinese banks. The debt is for seven solar and wind projects totaling 15 GW, as part of a wider USD 8.2 bn investment program, and the lenders include Bank of China, China Construction Bank, China Minsheng Bank, and ICBC, alongside European, Japanese, Saudi, and Emirati institutions.
In Abu Dhabi, three Chinese banks are among more than 20 lenders in Adnoc’s financing of up to USD 11 bn for its Hail and Ghasha offshore gas development. Adnoc and its partners commit future gas volumes to processing facilities, which gives lenders long-term contractual cashflows while Adnoc keeps operational control of the assets, according to its press release.
Beyond the loans
Chinese lending is closely tied to China’s ambitions in energy, infrastructure, and construction. Amandeep Kaur Ahuja, a MENA geopolitical risk consultant and researcher tells us the lending complements China’s involvement in infrastructure development, where financing and construction projects often go hand in hand. “China is one of the largest buyers of Gulf hydrocarbons, and Chinese firms like Sinopec and CNPC are big participants and investors in the industry. Chinese firms are also big players in EPC contracts and manufacturing investment in the Gulf. All of this suggests that an ecosystem is developing but not in the ‘tied export credit’ sense,” Hari argues.
Saudi renewables show the overlap, with Chinese lenders and Chinese contractors on the same projects. Chinese lenders are participating in Acwa Power’s 15 GW, while China Energy Engineering-linked firms won about USD 2.7 bn in contracts covering the Khulais solar and Shaqra wind projects, and PowerChina subsidiaries secured around USD 1.6 bn for two Afif solar plants.
In Qatar’s LNG, Chinese state oil companies are minority partners and long-term buyers. Sinopec holds a minority stake in both North Field East and North Field South and has signed 27-year agreements to buy a combined 7 mn tons a year. China National Petroleum Corporation (CNPC) holds a minority stake in North Field East and a separate 27-year agreement to buy 4 mn tons a year.
CNY lending is another strand of the relationship. A government in an unnamed UAE emirate secured a CNY syndicated loan worth about CNY 1.8 bn in 2025, Bloomberg reported. Acwa Power also took an USD 80 mn equity bridge loan from Bank of China in 2024 for a solar and battery storage project in Uzbekistan, with half in CNY and half in USD.
Lender diversity
Chinese banks have become important financiers of Gulf infrastructure. Their ability to provide large loans, attractive pricing, and longer maturities has made them increasingly important, García-Herrero adds, and they offer flexible financing structures and stay willing to back strategic energy projects when Western banks grow more cautious over geopolitical risk or compliance concerns. Their growing role in CNY-denominated financing gives Gulf borrowers another option, she adds.
Asia is now the first call for large Gulf financings, García-Herrero argues. “Asia has become the first call,” she says. Chinese financial institutions have moved from secondary lenders to the leading foreign source of syndicated financing for Gulf borrowers. “They are becoming a genuine major alternative, not just an add-on, with clear market-share growth,” she adds.
Chinese lenders share the region’s risks: “Chinese banks partly withdrew or reviewed Middle East exposure when conflict escalated in March 2026, demonstrating that Chinese lenders are exposed to the same regional risks and can act in response to their own regulators. Chinese finance therefore increases lender diversity but also adds new vulnerabilities in the form of Chinese regulatory decisions and US-China tensions,” Hari tells us. More lenders should improve resilience, he adds, but “it is not a hedge against geopolitical or financial disruption.”
Gulf borrowers keep considerable bargaining power by keeping relationships with Chinese, Western, regional, and other Asian lenders. China’s emergence as another substantial source of capital gives them more room to negotiate financing terms, while Gulf governments keep control of their infrastructure strategies, Hari notes.
Adnoc is turning to unconventional gas to help close the UAE’s supply gap. It has taken a final investment decision (FID) on Ruwais Diyab, its first large-scale unconventional gas development, which will produce 345 mmcf/d of raw gas over 25 years, according to a press release. Output could eventually rise to 1 bcf/d, though Adnoc hasn’t committed to that level or disclosed the investment value.
Why it matters: The UAE still imports gas to meet demand. Its supply deficit was an estimated 17.7 bcm last year, or about 1.7 bcf/d, based on its submissions to OPEC, Kate Dourian, a board member at the Energy Institute’s Middle East branch, tells us. Qatari gas through the Dolphin pipeline and about 500k tons of LNG imported through Dubai covered part of it. Ruwais Diyab’s first phase would cover about a fifth of that gap.
And demand may grow faster than planned: Adnoc Gas projects domestic gas demand growing 4-5% a year between 2023 and 2030. That forecast may be conservative because it excludes planned AI data centers, Dourian says. Recent awards, including the Bab and Umm Shaif gas caps, will help narrow the deficit, though more production will still be needed, she adds.
A third of the target
Ruwais Diyab has been producing on a small scale since 2020. Adnoc and TotalEnergies delivered first unconventional gas from the concession that year, with a target of 1 bcf/d before 2030. Output reached about 100 mmcf/d by February 2025, TotalEnergies CEO Patrick Pouyanné told the Middle East Economic Survey (MEES). TotalEnergies cut its stake to 10% from 40% in 2023, leaving Adnoc with 90% and operatorship.
The next phase starts in 2029 at about a third of that target: Adnoc Onshore will develop it under a design-build-operate model. The gas will be processed on site, then fed into the national network through new pipelines. That network is expanding too: the USD 2.4 bn Estidama project will extend it to more than 3.5k km from 3.2k km.
Paying for security
Unconventional gas costs more to produce. That raises questions about the returns from scaling it up, Dourian says, though the push to end imports is also about energy security and less exposure to swings in international gas prices. Foreign partners in several UAE gas developments also let Adnoc share capital requirements and development risk, she adds.
Adnoc is likely to sell the gas at home and abroad: “Ultimately, the stronger return will depend on production costs, domestic gas pricing, and the prices Adnoc can secure for LNG exports. LNG may offer greater commercial returns when international prices are high, but supplying the domestic market offers longer-term economic and strategic benefits. Adnoc is therefore likely to pursue both rather than favor one at the expense of the other,” Dourian says.
Most of its LNG is already spoken for: A wave of new global supply is due around 2028, when the Ruwais LNG plant starts up, which could mean lower international prices and tighter margins, Dourian says. Adnoc has already secured long-term sales for more than 90% of Ruwais LNG’s planned capacity, limiting its exposure to spot prices, she adds.
Dourian sees one target behind all of them: “I think all the gas developments in the UAE, including sour and unconventional gas, are about attaining self-sufficiency and ending reliance on imports by 2030,” she says.
What’s next: Ruwais LNG is due to start in 2028, Ruwais Diyab’s next phase comes online in 2029, and Umm Shaif adds gas from 2030.
Abu Dhabi’s sovereign wealth is buying into the jets airlines lease: The Abu Dhabi Investment Authority (Adia) is joining Irish lessor Avolon and infrastructure investor I Squared Capital to set up Constellation Aviation, a leasing platform that will start with 22 Avolon jets worth USD 1.4 bn at current market value, Avolon said in a statement. The aircraft average about five years old and are on lease to 17 airlines in 15 countries.
Adia is coming in as an infrastructure investor: It is investing through a wholly owned subsidiary, and the platform is built to give investors long-term contracted lease income. Aircraft leasing is a resilient, growing sector on the back of demand for modern jets, Khadem AlRemeithi, executive director of Adia’s infrastructure department, said in the statement.
Avolon keeps the keys
Avolon will still run the fleet, which could grow well past USD 1.4 bn. It keeps a minority equity stake and becomes Constellation’s exclusive aircraft manager and servicer. The partners plan to grow the platform to as much as USD 6 bn, a source familiar with the agreement told Reuters. The venture will also carry bank debt, with BNP Paribas, Crédit Agricole CIB, Société Générale, ING, MUFG, and Mizuho as joint lead bookrunners on a syndicated facility.
Backlog premium
Airbus and Boeing can’t build planes fast enough: Their combined order backlogs stretch beyond 11 years, pushing lease rates higher as airlines struggle to add capacity. High fuel costs make younger, more efficient aircraft more attractive, while factory and engine bottlenecks slow fleet renewal.
That makes a lessor’s place in the delivery queue worth paying for. Avolon holds one of the largest order books with Boeing and Airbus, I Squared co-founder and global CIO Gautam Bhandari said in the statement, and partnering with it gives Constellation a ready-made fleet and a team that can source more.
IN CONTEXT- Constellation is the latest in a string of Gulf-backed leasing platforms. Dubai Aerospace Enterprise (DAE) launched with Neuberger Speciality Finance in July, targeting around USD 6 bn in aircraft investments, three months after setting up Equator with Blackstone to deploy roughly USD 1.6 bn a year. Qatar’s Lesha Bank agreed in September to acquire 33 leased aircraft from Avolon, a portfolio valued at c. USD 1.6 bn.
Adnoc CEO Sultan Al Jaber says the world needs to hold more oil in reserve, and Gulf producers are already building those reserves in the countries that buy their crude. Speaking at the opening of the ADIPEC energy conference in Abu Dhabi, Al Jaber called for bigger strategic oil reserves, more refining capacity closer to consumers, and new transport routes to cope with disruptions like the one in Hormuz, Bloomberg reports. Aramco and Adnoc are lining up storage agreements across Asia, and in a shortage the host countries get first call on the barrels.
Why it matters: The world’s spare barrels are running low. Nearly 1 bn barrels have come out of global oil inventories over eight months of war, diesel stocks in some markets are at their lowest seasonal levels in 35 years, and LNG supplies have been disrupted, Al Jaber said on Monday. “Simply put, the world has eroded its supply buffers,” he said. Shipping and logistics now make up more than 30% of the cost of a barrel, up from less than 5% before the war, he added.
The World Bank sees the drawdown continuing. Its latest Commodity Markets Outlook sees global oil supply dropping 5.2% this year, the largest drop in more than four decades outside the 2020 recession. It expects consumption to fall 2.5% on high prices and electrification, particularly in China. With production still below consumption, stocks keep falling, and the market is more exposed to fresh disruption. The Bank sees Brent averaging USD 91 a barrel this year, up from USD 69 in 2025, and USD 105 in 2027 if the conflict escalates.
Of Al Jaber’s fixes, storage is the cheapest: Expanding strategic storage is a relatively inexpensive way to strengthen supply chains, even in normal market conditions, Jamie Ingram of the Middle East Economic Survey (MEES) tells EnterpriseAM. Building significant new refining capacity closer to consumers is a harder sell, and there is little appetite for it despite the disruption to refined-product supplies, he adds.
Storing oil abroad comes at a price: Leasing existing storage facilities overseas could cost USD 7-10 per barrel annually, Dalga Khatinoglu, editor-in-chief of Caspian Energy Intelligence, tells us. Building reserves of hundreds of mns of barrels would therefore carry substantial costs if the oil goes unused. Meanwhile, “building storage requires Gulf producers to produce mns of barrels per day above their OPEC+ quotas, while such additional supply would put significant downward pressure on global oil prices,” he adds.
Gulf producers are already putting that storage in Asia: Aramco holds 13.5 mn barrels in Japan and South Korea and agreed last week to pursue storage at Singapore’s Jurong Rock Caverns from 2H 2027. Adnoc plans to raise its storage in India to as much as 30 mn barrels, nearly triple the c. 11 mn barrels it leases there now. At Aramco’s sites in Okinawa and Ulsan, the host government has priority to buy the oil in a shortage.
More refining capacity isn’t necessarily the answer either: “Building more refineries in their home countries is another option. However, this would substantially widen the gap between crude oil production and refining capacity. In normal market conditions, such additional refining capacity would essentially have little practical use and could become economically inefficient,” Khatinoglu argues.
The answer is more routes: Ingram points to the East-West attacks as a sign of how quickly a backup corridor can become another chokepoint. “The name of the game is optionality. The more export routes you have available to you, the less the risk that assailants will be able to close them all down. This is why Saudi Arabia is looking to develop another route beyond just Yanbu or Ras Tanura,” he says. However, “those corridors would remain vulnerable to escalating attacks. The advantage is greater operational flexibility, rather than immunity from disruption,” Khatinoglu notes.
Even with more routes, production sites stay exposed, Ingram says. “The ultimate risk is that production or processing facilities themselves would be attacked. If there was substantial damage to facilities like Saudi Aramco’s Abqaiq plant, that would be more impactful than an attack on export facilities,” Ingram notes.
AD Ports appointed Afif Saif Al Yafei (LinkedIn) as group CEO, according to a press release. He succeeds Mohamed Juma Al Shamisi (LinkedIn), who had led the group since 2014. The statement didn’t mention a reason for the new appointment but noted that the group had grown into a global business under Al Shamisi’s tenure.
Al Yafei comes to ports from the power grid: Al Yafei brings over 20 years of experience in the infrastructure, utilities, and industrial sectors and joins AD Ports from Taqa Transmission, where he previously served as CEO. He also held senior positions at Tabreed, including as VP of asset management, and Adnoc Gas.
DP World is launching a shipping line between China and two of its own African ports: The Dubai-based operator’s Shipping Solutions business will start a weekly China Africa Link service in late November, connecting Shanghai, Ningbo, and Nansha with Dar es Salaam in Tanzania and Maputo in Mozambique, via Port Klang in Malaysia and Singapore, according to a press release. The service will carry Chinese machinery, electronics, construction materials, and automotive components to Africa, and agricultural products, minerals, and other commodities back.
The infrastructure behind the route is already taking shape: DP World runs Dar es Salaam under a 30-year concession, with more than USD 500 mn committed to upgrading the terminal and its technology. In Mozambique, the operator is backing a USD 2 bn expansion of Maputo port, with annual container capacity targeted to reach 1 mn TEUs. The new service follows Hapag-Lloyd’s September agreement to secure long-term capacity across DP World’s African terminals, reinforcing the operator’s push to connect its port investments with shipping networks.
Five more years
DHL is keeping Dubai Aerospace’s Joramco on its A300 maintenance for five more years. Joramco, the Amman-based maintenance, repair, and overhaul (MRO) arm of Dubai Aerospace Enterprise (DAE), has signed a new five-year agreement to carry out heavy maintenance checks on multiple lines of DHL’s A300 fleet, according to a press release. The agreement takes effect in January 2027 and continues a longstanding partnership. No contract value or aircraft count was disclosed.
DHL is also building its first MENA maintenance hangar for its Boeing freighters: The company is investing 85.1 mn in an aircraft maintenance hub at Bahrain International Airport to service its Boeing 777 and 767 cargo aircraft. Construction is due to start this month, with operations targeted for August 2028.
Saudi Arabia’s Go Telecom is building an AI cloud to rent out computing power. The company has awarded Total Technical Triangle Company (3T), an authorized Dell Technologies partner, a SAR 185.9 mn contract, excluding VAT, to supply and install the infrastructure for a cloud AI data center, according to a Tadawul disclosure. That’s about USD 50 mn, by our math. The 12-month project covers Dell computing systems with Nvidia GPUs, plus the servers, systems, and technical licenses needed to run the facility.
Go wants the revenue beyond telecom: It plans to sell AI and cloud computing services to public- and private-sector customers, and will disclose the financial impact once the contract is signed.
IN CONTEXT- Go joins several Saudi players adding AI computing capacity. Al Moammar Information Systems is investing USD 1.2 bn to take its data center capacity to 192 MW, and Humain and DataVolt have started building the first 100 MW of a planned 1.5 GW AI campus at Neom’s Oxagon, due online in 2028. Dell is also partnering with Armada on mobile data centers across Saudi Arabia for the energy, telecom, manufacturing, and public infrastructure sectors.
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