ADNOC forms joint venture to invest in Ruwais chemical projects
The partnership is a part of the oil company’s chemicals push
Abu Dhabi: Abu Dhabi National Oil Company (ADNOC) will form a joint venture with ADQ, a holding company with a diverse portfolio of major enterprises, to invest in chemical projects in the planned Ruwais Derivatives Park.
The partnership will “expand on existing efforts to maximize the value” of the oil producer’s assets in Ruwais, ADNOC CEO Sultan Ahmed Al Jaber said in a statement on Wednesday.
ADNOC and ADQ will jointly invest in anchor chemicals projects, with ADNOC holding a 60 percent majority equity stake in the JV.
ADNOC is part of a growing wave of energy companies that have invested in multi-billion dollar projects to produce petrochemicals – used in everything from plastics to clothing. With rising oil price volatility and a gradual shift to electric vehicles, oil producers are counting on petrochemicals to drive their revenues.
The deal supports the “transformation of Ruwais into a global hub for industry and attract additional foreign direct investment,” Al Jaber said.
The JV also complements ADQ’s portfolio, which includes a wide range of sectors such as logistics, transport, power and construction. “By partnering with ADNOC…we will play a key role, together with the public and private sectors, in providing essential infrastructure development services,” ADQ’s CEO Mohamed Hassan Alsuwaidi said.
The companies will conduct a comprehensive feasibility study to further develop identified projects in Ruwais. The results of the study will be announced before the end of 2020.
If approved by regulators, the JV will be incorporated in Abu Dhabi Global Markets with both companies jointly determining the JV’s management team and board.
Last month, ADNOC inked a $20.7 billion pipeline deal with global investors, which will result in upfront proceeds of over $10 billion to the oil company.