Abu Dhabi Polymers Company (Borouge)

24 July 2009

The state-owned petrochemicals producer is in the middle of an ambitious expansion project.

StructureAbu Dhabi Polymers Company (Borouge) was established in May 1998 as a joint venture of UAE state energy company Abu Dhabi National Oil Company (Adnoc), which holds a 60 per cent stake, and Austrian polyolefins producer Borealis, with a 40 per cent stake.

A separate marketing company, Borouge Pte, markets the polymers produced by the joint venture from its

Abu Dhabi’s International Petroleum Investment Company (Ipic) holds a 64 per cent stake in Borealis, with the remainder held by Austria’s OMV, in which the Abu Dhabi fund holds a 19.2 per cent stake.

Company snapshot
Date established1998
Main business sectorsPetrochemicals
Number of employees700+
Total output600,000 tonnes of polyethylene in 2008
Main business regionsAsia-Pacific, Middle East
CEOAbdulaziz al-Hajri


Abdulaziz al-Hajri, chief executive officer (CEO) of Borouge, was appointed in October 2007, taking over from Harri Bucht, who had served as CEO since March 2002.


Borouge’s operations are spread between its head office in Abu Dhabi, its main production site at Ruwais, 240 kilometres west of the capital, the Borouge Pte office in Singapore, and more recently its plastics manufacturing units and logistical hubs in China and Singapore.

Borouge first started producing 580,000 tonnes a year (t/y) of the basic plastic polyethy-lene in 2001. In 2005, this was increased to 600,000 t/y through an engineering process known as debottlenecking.

The company is in the process of increasing its production at Ruwais through the addition of a 1.4 million-t/y ethane cracker that will produce an extra 540,000 t/y of polyethylene and 800,000 t/y of polypropylene. The Borouge 2 expansion, valued at $2bn by Gulf projects tracker MEED projects, is due for completion in early 2010.

The company announced in early July 2009 that it is to go ahead with plans to add a further 2.5 million t/y of production capacity to its Ruwais operations through a third-phase expansion, Borouge 3, including the addition of low-density polyethylene to its product slate. This will allow Borouge to supply plastic coating for the specialist wire and cabling market. Borealis is already a leader in the industry in Europe.

On 31 May this year, Borouge announced the appointment of the US’ Bechtel as the project management consultant for this phase of the development. On 5 July, Germany’s Linde was awarded the engineering, procurement and construction (EPC) contract to build the cracker unit at the plant, which will break down 1.5 million t/y of ethane into propy-lene and ethylene.

On 6 July 2009, meanwhile, Italy’s Tecnimont was awarded three front-end engineering and design (Feed) contracts to design the polypropylene, polyethylene and low-density poly-ethylene units for the scheme, alongside the utilities for the project.

Borouge Pte has an extensive sales and marketing network, with sales offices in Beijing, Beirut, New York, Hong Kong, Mumbai and Shanghai, and representatives in Australia, New Zealand, Taiwan and Thailand.

The company’s products are mainly targeted at the Asia and Middle East markets, although the use of ethane as a feedstock means the company has a cost advantage over European producers, which attracts interest from Western buyers.

To process the extra volumes of plastics Borouge 2 will create, and to further develop its footprint in Asia, the company is currently building a 600,000-t/y logistics hub at Shanghai, China, which is due for completion in 2010.

In January, Borouge signed up the local CWT Logistics to develop a similar hub in Singapore. The company is also building a 50,000-t/y plastics compounding unit at Guangzhou, China, due again for completion in 2010.

When Borouge 2 is operational, the company will supply Indian automotive plastics supplier Machino Polymers with polypropylene, and the two partners are in talks over how they can further develop their relationship.


Undaunted by the collapse in prices and demand that has hit the global petrochemicals industry as a result of the global financial downturn that began last year, Borouge is determined to become one of the largest polyolefins producers in the world, and a key exporter.

“Nowhere else in the world has a petrochemicals company installed so much olefins capacity in such a short time as Borouge is currently doing in Abu Dhabi,” says Aldo Belloni, member of the board of directors at Linde.

From 2010, Borouge will produce 2 million t/y of polyethylene and polypropylene, with the figure set to more than double to 4.5 million t/y by 2013, when Borouge 3 is completed.

The company uses ethane and propane supplied by joint venture partner Adnoc in the production of petrochemicals, giving it a strong cost advantage over European producers, which rely on more expensive naphtha.

The company is also developing its logistics network in preparation for a stronger drive into Asian markets, particularly China, where it hopes to become the predominant player.

A joint development with Borealis, called the Abu Dhabi Innovation Centre, will invest in technological developments in the petrochemicals industry. Employing 45 staff, it is due to open in late 2009.

Sources close to the company tell MEED that a fourth-phase expansion of the company’s capacity, Borouge 4, is in the early planning stages, but is largely dependent on the avail-ability of ethane and propane supplies, with demand for natural gas as a feedstock for power plants rising in the emirate.

MEED assessment

Abu Dhabi’s first foray into the petrochemicals market beyond the manufacturing of fertilisers has been a huge success. The strong feedstock advantages provided by direct integration into Adnoc’s upstream production, alongside Borealis’s established place in the global market and technological know-how, have made for a solid combination.

Borouge is sticking to its business plan of producing basic plastics while developing a wider customer base and continuing to expand its production capacity.

The global petrochemicals market is currently challenging because of low demand for plastics and low prices for polymers. But Borouge’s feedstock advantages, coupled with its expansion ambitions, mean the company will be making the petrochemicals headlines for decades to come.

Q&A Abdulaziz Al-Hajri, CEO, Borouge

Where does Borouge fit in with Abu Dhabi’s strategic vision for the petrochemicals sector?

The development of the petrochemicals industry in Abu Dhabi is very exciting and Borouge is at the forefront of these developments.

Notwithstanding the current economic climate and market conditions, we remain committed to our long-term strategy and are in the process of expanding our plant in Ruwais to become one of the largest petrochemical plants in the world. By the end of 2013, we will be manufacturing 4.5 million tonnes of polyolefins annually. As a result of this expansion, Borouge will play an increasing role in the diversification and development of the Abu Dhabi economy.

Why use ethane as a feedstock?

We focus on manufacturing added-value polyethylene, and in the very near future also polypropylene. Ethane is an efficient feedstock for the manufacture of these polyolefins, also providing excellent yield. We do not intend to manufacture other petrochemicals beyond polyolefins, and do not see this as a limitation.

What is your relationship with Chemaweyaat?

Although [Abu Dhabi National Chemicals Company] Chema-weyaat plans for a broad range of products, it also intends to manufacture polyolefins. As we are indirectly related, naturally there is co-ordination in our common activities to ensure we complement each other.

What agreements do you have in place for feedstocks with Abu Dhabi National Oil Company (Adnoc) and its subsidiaries?

To add value and maximise the return on the overall investment. Borouge is an integral part of the oil, gas, refinery and petrochemicals development within the Adnoc group of companies, and as such, our feedstock is linked to upstream development.

What are your plans after Borouge 3?

We aim to continue to grow our position in the polyolefins industry way into the next decade. We are considering future opportunities with our owners but it is too early for us to discuss further expansion. Right now, we need to focus on Borouge 2 and Borouge 3 implementation.

What are your thoughts on downstream developments like Abu Dhabi Polymers Park?

We are committed to supporting the downstream development of the local industry and the diversification of the Abu Dhabi economy. As such, we support the vision of Abu Dhabi Polymers Park and follow its developments, supporting it where we can.

How important a role does International Petroleum Investment Company (Ipic) play in the development of the petrochemicals industry in Abu Dhabi?

Ipic is playing an active and leading role in the development of the petrochemicals and chemicals industry, both through Borouge indirectly and more recently through Chemaweyaat. Its continuing commitment to the industry is essential for the Abu Dhabi industry and economy.

How important will Asian markets be for Borouge’s future growth?

Asia-Pacific is one of our key markets and we are investing in the region to capitalise on the growth in these markets. The establishment of a compounding manufacturing unit in Shanghai and logistics hubs in Singapore, Shanghai and Guangzhou represent our first major investments in the region.

In global terms, the Asian markets seem to be faring much better than many parts of the world. For example, the Chinese automotive market is on track to become the largest in the world, with positive growth in the low-to-medium sector.

We see similar developments in India and therefore we have also recently signed a co-operation agreement to supply compounded resins into the Indian automotive market.

The solid growth in infrastructure such as pipe systems and the communication and energy networks, as well as advances in healthcare in Asia, also provides exciting opportunities for Borouge.

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