ADNOC Bolsters Chemicals Growth Strategy With Key Global Acquisitions

ADNOC recently announced a significant step in its chemicals growth strategy by acquiring a 35 percent equity stake in ExxonMobil’s proposed low-carbon hydrogen and ammonia production facility in Baytown, Texas. This move aligns with ADNOC's goal to create a leading chemicals platform that meets the increasing demand for lower-carbon petrochemicals, ammonia, and hydrogen while aiding global decarbonisation efforts.

The acquisition of OCI’s majority shareholding in Fertiglobe is nearing completion, expected to conclude in the fourth quarter of 2024. ADNOC signed a Sale and Purchase Agreement with OCI in December 2023 to acquire OCI’s entire majority stake. An ADNOC spokesperson stated, "The acquisition of OCI’s stake in Fertiglobe aligns with our ambitious chemicals growth strategy, supporting our plans to establish a global platform for sustainable blue ammonia. It will enable Fertiglobe to accelerate its pursuit of new markets and product opportunities, particularly in the emerging low-carbon solutions sector."

ADNOC also holds a majority 54 percent stake in Borouge plc, which provides innovative polymer solutions to customers across Asia, the Middle East, and Africa. In 2023, Borouge achieved sales exceeding 5 million tonnes and maintained a premium over benchmark prices for polyethylene and polypropylene products.

Borouge is advancing with the Borouge 4 expansion project worth US$6.2 billion. This project aims to create the world’s largest single-site polyolefin complex, boosting capacity to 6.4 million tonnes annually. This expansion supports ADNOC’s commitment to meet future demand while promoting sustainable growth within the petrochemical sector.

Additionally, Borouge has entered into a Project Collaboration Agreement with Wanhua Chemical and Wanrong New Materials (Fujian) to explore a greenfield project in China. This proposed specialty polyolefins complex aims to produce 1.6 million tonnes per annum of high-quality polyolefins, reinforcing Borouge’s position in the Asian market and supporting ADNOC’s broader regional growth ambitions.

Domestic Initiatives and International Expansion

TA’ZIZ, located in Al Ruwais Industrial City, Abu Dhabi, plays a crucial role in ADNOC’s chemicals growth strategy by producing new chemical products locally for the first time. This initiative reduces reliance on imports and creates opportunities for local businesses while advancing ADNOC’s low-carbon agenda through partnerships like the one with Fertiglobe for developing a low-carbon ammonia project.

Internationally, ADNOC is expanding through strategic mergers and acquisitions. The company holds stakes of 24.9 percent in OMV and 25 percent in Borealis AG. As announced last year, ADNOC and OMV AG are negotiating to merge their shareholdings in Borouge plc and Borealis AG. Borealis AG specialises in polyolefin solutions and recycling.

The planned acquisition of OCI’s stake in Fertiglobe is progressing well with most clearances already obtained. The remaining approvals are expected soon, keeping the acquisition on track for completion by late 2024.

This series of strategic moves underscores ADNOC's commitment to building a robust chemicals platform that supports global decarbonisation efforts while unlocking new revenue streams both domestically and internationally.

With inputs from WAM