Abu Dhabi (Al Ittihad)
ADNOC has achieved a significant milestone in its ambitious strategy to grow its chemicals business by announcing an agreement to acquire a 35% stake in ExxonMobil’s proposed low-carbon hydrogen and ammonia production facility in Baytown, Texas.
ADNOC’s strategy to grow and expand its chemicals business aims to create a leading global chemicals production platform to meet the growing demand for low-carbon petrochemicals, ammonia and hydrogen, and contribute to global efforts to reduce emissions.
This strategy focuses on expansion and growth at the local and international levels in the chemicals sector to ensure that its business is future-proof and creates new sources of revenue.
ADNOC plans to acquire OCI’s 50% + 1 share stake in Fertiglobe, with the deal reaching its final stages and expected to be completed in the fourth quarter of 2024.
In December 2023, ADNOC and OCI signed a sale and purchase agreement under which ADNOC will acquire OCI’s entire stake in Fertiglobe. Following completion of the transaction, ADNOC will become the majority shareholder in Fertiglobe.
ADNOC’s acquisition of OCI’s stake in Fertiglobe is in line with the company’s ambitious chemicals growth strategy and supports its plans to create a global sustainable blue ammonia platform. The acquisition will also enable Fertiglobe to accelerate its efforts to pursue new market and product opportunities, particularly in the emerging low-carbon solutions sector.
The acquisition is making good progress, having already obtained a number of approvals, and all remaining approvals are expected to be obtained in the coming months, with the deal scheduled to be completed in the last quarter of this year.
ADNOC also owns a 54% majority stake in Borouge PLC, a leading provider of innovative and differentiated polymer solutions to customers in more than 50 countries across Asia, the Middle East and Africa. To further enhance its production capacity, Borouge is developing Borouge 4, a $6.2 billion expansion project that will increase the company’s total polyolefin production capacity to 6.4 million tonnes per year, making it the world’s largest single-site polyolefin complex.
In addition, Borouge, as part of a consortium including ADNOC and Borealis, has signed a cooperation agreement with Wanhua Chemical and its subsidiary Wanrong New Materials – Fujian, to explore the feasibility of establishing a new project in China. The proposed project is set to produce 1.6 million tonnes per year of high-quality specialty polyolefins.
Tazeez, the chemicals and industrial ecosystem under development in Ruwais Industrial City in Abu Dhabi, is a key enabler of ADNOC’s chemicals growth strategy, producing new chemicals for the first time in the UAE to help reduce reliance on imports and replace them with locally-made products, in addition to creating opportunities for local companies to grow and develop.
Tazeez is also a key component in supporting ADNOC’s low-carbon business, through its partnership with Fertiglobe to develop a project that aims to produce one million tons per year of low-carbon ammonia in Abu Dhabi.
ADNOC also seeks to expand internationally through a number of strategic mergers and acquisitions. ADNOC owns a 24.9% stake in OMV and a 25% stake in Borealis AG, while OMV owns the remaining 75% stake in Borealis.
As announced in July last year, ADNOC and OMV AG are in formal negotiations to merge their existing stakes in Borouge PLC and Borealis AG, the innovative and differentiated polyolefins and recycling solutions company headquartered in Vienna.
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