The Abu Dhabi government has become the latest state in the Gulf region to seed hedge funds after committing $300m to a portfolio set up by fund of funds manager Man Group.

The MENA Associated Gas and Global Environment Fund, which is to be managed by Man Group subsidiary MTM Capital Partners, announced yesterday that it will receive $300m of capital from the International Petroleum Investment Company, a subsidiary of the Abu Dhabi government MTM is seeking $1.5bn for the fund to invest in projects that capture greenhouse gases produced in crude oil's production, and use those gases to generate electricity.