Borouge plans final $200m Ruwais plastics expansion deal

29 April 2010

State plastics producer will tender cross-linked polyethylene deal in May

Abu Dhabi Polymers Company (Borouge) plans to tender a final $200m engineering, procurement and construction (EPC) contract for the third-phase expansion of its Ruwais plastics production complex in May, sources close to the project tell MEED.

The state plastics producer prequalified around five international engineering companies to bid on the deal in late April and plans to issue formal bid documents in early May, executives with close ties to the scheme say.

The EPC deal covers the construction of a specialist cross-linked polyethylene (XLPE) conversion unit and will form the final part of the company’s Borouge 3 development.

Contractors with knowledge of the scheme value the contract at around $200m. Technology will be provided by Austria’s Borealis, a 40 per cent shareholder in Borouge.

Borouge is in the process of tendering three other major EPC contracts on the scheme, and has asked firms to submit their final bids, outlining cost proposals, in May.

Firms bidding on the estimated  $1bn contract to build the main supporting infrastructure for the project, the offsites and utilities, have been set a 23 May deadline for their prices. Contractors hoping to win the contracts to build a $500m low density polyethylene and $1bn-plus polyolefins conversion unit have been asked to hand in their cost proposals by 16 May.

In July 2009, the company awarded a $1.07bn deal to Germany’s Linde to build a 1.5-million-t/y cracker unit to break down ethane, a component of natural gas, into ethylene and propylene. Once completed, the cracker will be one of the biggest of its kind in the world.

In November 2009, the local Al-Asab General Transportations and Contracting Establishment won a $300m deal to prepare the Ruwais site for the expansion.

Borouge 3 will boost the company’s Ruwais complex to 4.5 million t/y of the plastics polyethylene and polypropylene once construction is complete in 2014.

The expansion’s output will be targeted at Asian markets, particularly China where Borouge inaugurated a new plastics conversion unit in late April.

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