Abu Dhabi flexes petchem muscles

Abu Dhabi has been targeting growth in the non-oil sectors to further bolster the Emirate's economy and now its strategies are coming to fruition, with major investments being directed into the petrochemicals industry.

In November 2016, the Abu Dhabi National Oil Company (ADNOC) announced that it is planning to increase the Emirate's production of petrochemicals twofold, in-line with its 2030 Strategy, which has only recently been approved by Abu Dhabi's Supreme Petroleum Council. The 2030 Strategy sets out growth targets for UAE petroleum production to increase by more than 150 per cent over the coming nine years to 11.4 million tonnes annually.

Borealis set to benefit?

This strategy has global implications, with Abu Dhabi's Borealis petrochemicals group, which ranks as the world's second-largest maker of polyethylene and polypropylene, set to benefit. Borealis' alliance with joint-owned Borouge (which is 60 per cent owned by Adnoc and 40 per cent owned by Borealis) and Nova Chemical in the US forms a strong global network to bring this added production capability downstream into key growth markets including India, Africa and the Asia-Pacific region, where the petrochemical market is set to double by 2030.

"Under its new 2030 Strategy and five-year business plan, Adnoc will diversify and increase production of its petrochemical portfolio, while opening new markets to ensure sustained profitability," said HE Sultan Ahmed al-Jaber, UAE Minister of State and Adnoc CEO at the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC), which took place on November 10th.

Meeting the needs of the market

Along with petrochemicals, the 2030 Strategy focuses on gasoline and aromatics production, targeting growing demand both at home and abroad for refined petrochemical products, while it promises to 'stretch the margin of each barrel of oil processed', in a bid to deliver a more value-added and profitable downstream business.

"We are the proud owners of world-scale modern assets, located centrally to serve growing markets," stated Abdulaziz Abdulla Alhajri, Adnoc Refining and Petrochemicals Director. "We are creating synergies by integrating our refining and petrochemicals businesses across the value chain. This will meet the needs of the evolving and expanding market for refined and petrochemical products, drive efficiencies and increase profitability.

"Adnoc’s ultimate goal is unlocking the full potential of our assets. So, we are pursuing profitable and integrated growth in refining and petrochemicals. We are also diversifying our product portfolio to make us more resilient to economic cycles and crude oil price fluctuations."

Adnoc revealed that its petrochemical production will increase from 4.5 million tonnes per annum in 2016 to 11.4 million tonnes per annum, with the new expansion project increasing Abu Dhabi's polyolefin and aromatics production capacity with a world-scale mixed feed liquid cracker.