Adnoc and Cepsa to set up chemicals plant in Ruwais as part of expansion

Abu Dhabi National Oil Company signed an agreement with Mubadala Investment Company-owned Cepsa to set up a 150,000 tonnes a year chemicals project. This is part of a broader expansion of Adnoc’s integrated refining and petrochemicals complex in the capital’s western region of Ruwais.

The companies will manufacture linear alkyl benzene (Lab), a compound used in the detergents industry, after having completed feasibility studies over the past six months, Adnoc said in a statement yesterday.

However, it did not disclose the cost of the project.

“As we expand downstream and grow our refining capacity and capabilities, we will be able to expand the number of new products and value chains we can create,” said Abdulaziz Al Hajri, Adnoc’s downstream director in the statement.

The development comes amid Adnoc’s plans to invest Dh165 billion with international partners across its downstream value chain as it looks to transform existing facilities at Ruwais into the world’s largest integrated refining and petrochemicals complex by 2025.

Adnoc, which announced its strategy on Sunday, will build a new 600,000 barrels per day refinery and boost chemicals production from 4.5 million tonnes per annum to 14.4 mtpa by 2025.

The planned Lab facility forms part of the downstream effort to spur the creation of a “surfactants cluster”, said Mr Al Hajri. Surfactants refer to compounds that go into the manufacturing of detergents, foaming and wetting agents as well as emulsifiers.

The Lab facility will derive feedstocks of kerosene and benzene from the adjacent refinery to manufacture surfactants.

As part of its larger expansion, Adnoc said it would set up a derivatives and conversion park in Ruwais to develop industry clusters specialising in chemicals and their compounds, using feedstock from the existing and planned refining and chemicals complex.

Spain’s Cepsa, which is 100 per cent owned by Abu Dhabi strategic firm Mubadala, is one of the largest producers of Lab in the world.

The Spanish energy company, which has oil assets in South America, South East Asia and Kenya, wants to expand its upstream and downstream portfolio amid a growing tilt towards increasing its exposure to the energy industry in the Middle East.

The company in February won a 20 per cent stake worth $1.5bn in the twin oil concessions of Umm Lulu and Sarb, which lie offshore the territorial waters of Abu Dhabi.

The firm’s recent successes in the region has made it ripe for a floatation, Mussabeh Al Kaabi, Mubadala’s Petroleum and Petrochemicals chief executive told The National in an interview in March.

The Mubadala energy platform is targeting a listing in Spain for Cepsa before the end of 2018, he said.