UAE firm makes its first foray into US by joining Kimmeridge’s gas and LNG business

UAE-headquartered Mubadala Energy, a wholly-owned subsidiary of Mubadala Investment Company owned by the government of Abu Dhabi, is entering the U.S. energy market through an equity investment into the upstream gas and liquefied natural gas (LNG) business run by a subsidiary of Kimmeridge, an energy-focused alternative asset manager.

Mubadala Energy’s agreement to acquire a 24.1% interest in Kimmeridge’s SoTex HoldCo (SoTex) via the issuance of new equity allows the Abu Dhabi-based player to get access to two companies: Kimmeridge Texas Gas, which operates an upstream unconventional gas business in the Eagle Ford in South Texas, and Commonwealth LNG, which owns the 9.3 million metric tons per year (mtpa) liquefaction and export facility in the preliminary final investment decision (pre-FID) stage at the mouth of the Calcasieu Pass, Louisiana.

Dr. Bakheet Al Katheeri, Chairman of the Mubadala Energy’s Board and Chief Executive Officer, UAE Investments Platform, Mubadala Investment Company, commented: “Through this partnership and our entry into the U.S., we are to further build on our leading role in building energy champions that deepen our position in the global economy.

“We are delighted that Mubadala Energy has finalized this equity investment with Kimmeridge to enable the development of key gas projects in the U.S. Gulf Coast. As the company’s first major investment in the U.S., this transaction positions Mubadala Energy for accelerated growth across the gas value chain in one of the world’s most important and attractive energy hubs.”

While the deal marks Mubadala Energy’s entry into the U.S. market, SoTex is said to enable Kimmeridge to build America’s first integrated gas independent to deliver low-cost natural gas from wellhead to water and meet the rising demand for responsibly produced LNG across global markets. Kimmeridge Texas Gas’ current net production, which has exceeded 500 MMcfe/d, is expected to grow organically to 1.5 Bcfe/d by 2031.

Ben Dell, Managing Partner of Kimmeridge, noted: “Mubadala’s investment and unwavering support represent a significant milestone in the realization of our wellhead-to-water strategy, accelerating Commonwealth LNG’s path to final investment decision. We extend our sincere gratitude to the Mubadala Energy team for their invaluable partnership and collaboration as we work together to drive energy innovation and accelerate the transition to a cleaner, more sustainable energy future.”

Furthermore, Commonwealth LNG is finalizing key pre-FID workstreams ahead of taking FID later this year, with the first offtake from the LNG plant planned for 2029. Mubadala sees this equity investment as “an important moment in its international expansion,” bolstering its growth plans to invest across the gas value chain in key global energy hubs and acting as a major addition to its existing global gas portfolio.

Given the company’s goal of playing a proactive role in the energy transition by supporting gas projects as a bridge to a lower carbon energy future, this investment is perceived to be in line with the UAE’s 2050 net-zero ambition. The transaction is subject to customary regulatory filings and approvals before closing.

Mansoor Mohamed Al Hamed, Managing Director and CEO of Mubadala Energy, emphasized: “As our first major investment in the U.S. this transaction offers a significant platform for future growth in one of the world’s most important energy hubs.

“The investment also highlights our strong position to accelerate our expansion across the gas value chain and build on our strategic international portfolio. We’re excited about the long-term opportunities this partnership offers, in line with our strategy to play a proactive role in the energy transition and grow our global gas portfolio.”

Since U.S. LNG supply is forecast to take up approximately 33% of the global market by 2050, Mubadala describes its investment as “a strategic play in one of the world’s most important gas hubs,” where infrastructure and a highly liquid M&A market ensure long-term prospects in the region, supported by energy demand trends in areas such as artificial intelligence (AI) data center development. 

This comes only months after Kimmeridge got the Trump administration’s blessing to proceed with its proposed LNG export terminal on the west bank of the Calcasieu Ship Channel at the mouth of the Gulf of Mexico/America near Cameron Parish.

As a result, the Commonwealth LNG project became the first major U.S. LNG project to receive an export authorization for non-free trade agreement (non-FTA) countries since the Biden-Harris administration’s freeze on LNG export permit approvals.