ADNOC's Borouge awards contracts targeting Dh600m plus EBITDA gains

Dubai: The ADNOC petrochemicals entity Borouge has gone in for capacity expansions that will contribute between Dh600 million to Dh730 million in EBITDA gains.

The company has awarded two contracts to boost capacity at its second ethane cracker (EU2) and the fourth and fifth polyethylene units (PE4 and PE5).

Linde Engineering bags the contract for front-end engineering design (FEED) services to upgrade Borouge’s second ethane unit (EU2) with an additional capacity of 230,000 tonnes per annum.

"This strategic project is expected to increase the EU2 cracker’s capacity by 15%, delivering significant financial gains upon completion in Q4-2028," said a statement.

"The ethane used as feedstock for the EU2 cracker is supplied by ADNOC Gas and ADNOC Refining, ensuring an integrated and reliable supply chain."

The other contract went to Target Engineering Construction Company, for the expansion and refurbishment of its PE4 and PE5 production units.

"This enhancement will increase their nameplate capacity from 540,000 to 700,000 tpa each," Borouge added.

This is scheduled to be ready for start-up in Q1-2027.

“By increasing production at our EU2, PE4 and PE5 units - as well as delivering the Borouge 4 mega-project - we are strategically positioned for accelerated growth," said Hazeem Sultan Al Suwaidi, CEO of Borouge.

Since 2001, Borouge has raised annual production capacity ten-fold, to 5 million tpa. This makes it among the Top 5 polyolefin producers in the Middle East and Asia-Pacific.

Together with Borouge 4, the expansion, once fully ramped up, will increase annual total polyolefins production capacity to over 6.6 million tpa by 2028.

Recently, ADNOC and the other Borouge shareholder OMV proposed to combine Borouge and Borealis, along with the acquisition of Nova Chemicals, to create 'Borouge Group International'.

These deals will create the 'world’s fourth largest polyolefin company' - a $60 billion entity with a capacity of 13.6 million metric tonnes across 62 plants spanning North America, Europe and the Middle East.

This more than doubles Borouge’s current capacity.