Dubai: The petrochemical industry of the UAE is currently undergoing a massive refinery expansion programme to compete in Asian markets with Saudi Arabia and Qatar, according to the latest UAE Petrochemicals Report released by London-based market researcher Companiesandmarkets.com.
The availability of naphtha in the UAE will be boosted by the refinery expansion at Ruwais, helping to retain the Emirati industry's competitive edge, the report said. The expansion will more than double the refinery's oil processing capacity to 817,000 barrels per day, from 400,000 barrels per day by 2014, by which time Abu Dhabi will have more than 900,000 barrels per day of total refining capacity.
The main focus is on the expansion of the Borouge petrochemical complex at Ruwais, Abu Dhabi. The current expansion project, Borouge 2, is due to commence production in 2010. This project will triple existing production and include, for the first time, polypropylene, Borouge said in an accompanying statement to its second quarter earlier this month. During the quarter, contracts valued at $3.7 billion (Dh13.58 billion) were awarded for the Borouge 3 project in Abu Dhabi.
Borouge was established in 1998, as a joint venture between the Abu Dhabi National Oil Company (Adnoc) and Borealis, a European plastics provider owned by Abu Dhabi's Ipic and Austrian oil company OMV.
"Our start-ups in Europe and the Middle East are progressing well, which gives us confidence for the future," said Borealis Chief Executive Mark Garrett. "However, as the world economy remains volatile we need to remain cautious in the short term. Thanks to our liquidity and the commitment of our owners we're able to continue to invest in our future, in Europe and in the Middle East."
In the short term, the second phase of the Borouge complex at Ruwais is on course to come online, in the third quarter of 2010, which should boost ethylene capacity from 600,000 to two million tonnes per annum and create 800,000 tonnes per annum of propylene capacity.
It will also raise polyolefin production capacity to two million tonnes per annum. The new expansion will be located next to Borouge's existing petrochemical complex in Ruwais, Borouge 1, a $1.2 billion (Dh4.40 billion) complex with a 600,000 tonnes per annum cracker and a 450,000 tonnes per annum polyethylene unit. The new capacity will be marketed mainly to the Middle East and Asia Pacific, targeting high-end applications in the pipe and high performance packaging areas.
The project by Abu Dhabi National Chemicals (Chemaweyaat), a $20 billion (Dh73.45 billion) development, originally planned to be set up at Khalifa Port and Industrial Zone (KPIZ), will now be built in the Western Region adjacent to Ruwais. Most of the production facilities owned by state refiner Abu Dhabi Oil Refining company, Takreer, are located at Ruwais so the relocation will make the project more feasible and eliminate the need to build a giant pipeline for the feedstock naphtha for the plant, the company said in July. The move will allow the Chemaweyaat to locate all 12 stages of what is to be the world's largest integrated chemicals complex near its main energy feedstock, produced at the oil refinery in Ruwais.
