ADNOC sees 'considerable' interest in $45bn downstream expansion plan

Abu Dhabi National Oil Company explores a range of new growth options and initiatives to accelerate the delivery of its recently announced downstream strategy
By Sam Bridge
Wed 23 May 2018 04:56 PM

Abu Dhabi National Oil Company (ADNOC) has announced that it is receiving considerable interest from potential partners, as it explores a range of new growth options and initiatives to accelerate the delivery of its recently announced downstream strategy.

ADNOC plans to invest AED165 billion ($45 billion) to become a global downstream leader, enabling it to further stretch the value of every barrel it produces, creating a range of opportunities for new and existing partners and investors.

The downstream strategy will build on the ADNOC transformation program of the last two years, which focuses on maximizing value by driving operational efficiency, enhancing performance, realigning the management of its portfolio of assets, and introducing a new and expanded partnership and investment model, a statement said.

Dr Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO, said: “As we grow in the downstream, a central pillar of our strategy will be the creation of a global refining and petrochemical growth engine at Ruwais. We are exploring a range of options in Ruwais, including bringing in partners who share our vision to develop new businesses that will accelerate the growth of the complex.

“The expansion and enhancement of our refining capabilities in Ruwais, along with the development of Derivatives and Conversion Parks, are key initiatives aimed at significantly expanding ADNOC’s downstream operations.

"They will provide the UAE private sector, and international companies, the opportunity to partner with us to build and profit from the extended petrochemical value chain. The entire plan will support the development and diversification of the UAE’s economy, create highly skilled, specialized jobs and contribute to GDP growth.”

ADNOC said it is now accelerating this transformation by executing its downstream strategy that is aligned with ADNOC’s 2030 strategy of a more profitable upstream, more valuable downstream, more sustainable and economic gas supply, and more proactive, adaptive marketing and trading.

ADNOC added that it will look to create long term downstream partnerships, providing access to opportunities across the value chain for both investors and partners.

Bob Dudley, CEO of BP, said: “Abu Dhabi for us is a strategic partner, it’s a great place to invest...the UAE has great resources to produce, and it exports those, but now it can take them and add more value to every barrel of crude oil and natural gas it produces, turning them into other products, and sending them to the markets. This seems like a natural fit because Abu Dhabi is located at the cross roads of the world, and it’s a really ambitious idea that Abu Dhabi has experience of executing.”

Central to the plan will be a major enhancement and expansion of refining, petrochemicals and manufacturing operations and capabilities in Ruwais.

The plans will see crude oil refining capacity doubled, and petrochemicals production tripled by 2025. In addition, the plans will see the creation of more than 15,000 highly skilled, specialized jobs in the petrochemicals and refining fields added by 2025, along with a contribution of an additional 1 percent to GDP per year.

With a refining capacity of 922,000 barrels per day (bpd) of crude and condensate, ADNOC’s operations in Ruwais already make it the fourth largest refining complex globally, representing 10 percent of refining capacity in the Middle East.

ADNOC aims to increase and enhance the processing capacity and capabilities of the Ruwais refinery and petrochemicals complex through a range of new initiatives and investments, including a new greenfield refinery project, a gasoline aromatics project, a new linear Alkyl Benzene project, a mixed feed cracker and an additional polypropylene plant.

In parallel to the developments at its domestic refining operations at Ruwais, ADNOC said it is actively pursuing international expansion by targeting select growth market opportunities to establish new refining and petrochemical footprints across the value chain and improve its market access and product placement capabilities.

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Last Updated: Wed 23 May 2018 05:01 PM GST

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