Adnoc downstream expansion to add petchem volumes

Abu Dhabi state-owned Adnoc's downstream expansion plans involve a huge increase in petrochemical output, including a world-scale mixed-feedstock steam cracker, additions to its existing polyethylene and polypropylene production, and other derivatives. Adnoc has the Borouge 4 expansion project slated for start-up around 2025.

Borouge 4 will include 1.95mn t/yr of polyethylene, 470,000 t/yr of polypropylene, 350,000 t/yr of butadiene, 1.2mn t/yr of monoethylene glycol, 360,000 t/yr of benzene and 300,000 t/yr of MTBE. It will include a mixed-feedstock cracker to produce 2.4mn t/yr of polymers. Borouge 4 moved to the initial engineering stage in July 2017.

Once complete it will add to the 4.5mn t/yr of products already produced from Borouge 1, 2 and 3.

Borouge 4 is part of a $45bn investment, aimed at creating the world's largest integrated refining and petrochemicals complex at Ruwais, that will "provide all the basic feedstocks" for this higher level of output, the firm's downstream director Abdulaziz al-Hajri told Argus.

Adnoc is also planning a 1.62mn t/y Gasoline Aromatics Project (GAP), to produce 1.46mn t/yr of paraxylene and 160,000 t/yr of benzene and start up by 2023, and a 500,000 t/yr polypropylene unit, called PP5, which will integrate with Borouge 3 with a targeted start-up in 2021.

Adnoc is looking for minority partners in its downstream expansion ventures. What size stake will be available will depend on the value a potential partner can add. Adnoc will always retain a majority stake, al-Hajri said. Partners will have to show tangible benefits, such as technology and market access, and not just capital.

The broader stream of products from these projects will provide the necessary chemicals for the planned Ruwais Derivatives Park in which Adnoc and partners will invest in assets that produce new primary chemical products. Beyond this, a Ruwais Conversion Park will enable new businesses even further down the value chain, taking feedstock from the refineries, Borouge and the Derivatives Park to manufacture higher-value, converted end-products including packaging materials, coatings, high voltage insulation, pipes and automotive composites.

A "big chunk" of the $45bn investment will go towards building a new 600,000 b/d Ruwais refinery, al-Hajri said. He expects this to come online by 2025. It will complement Adnoc's existing two refineries at Ruwais, which have a combined capacity of 817,000 b/d.

Adnoc is keen to find a partner for the refinery that can help develop the firm's expanding trading unit. "The best trading partner is a refinery partner," al-Hajri said. Such a partner would facilitate Adnoc's ambitions to "stretch the value of every barrel it produces," as it increases its crude processing flexibility.

Adnoc plans to process heavier and more sour grades — primarily Upper Zakum (33.9°API) — to allow increased exports of the higher-value Murban (40.5°API). Adnoc is examining the possibility of importing crude to process. As part of this, Adnoc is reconfiguring the 417,000 b/d Ruwais 2 refinery to process heavier crudes, and is adding a sulphur recovery unit.

Repairs are ahead of schedule at the Ruwais Adnoc's 127,000 b/d residual fluid catalytic cracker (RFCC), which was shut down after a fire on 11 January 2017. Al-Hajri said the RFCC will be online "by the end of the year — November or December." Adnoc had expected the unit to be back on line in early 2019.

Adnoc had planned to build an oil refinery in Fujairah, UAE, which would be fed by a 20bn m³/yr onshore facility proposed by Emirates LNG. Weaker-than-expected gas demand in the UAE may have contributed to the decision to abandon the project and later dissolve Emirates LNG.