Petrochemicals company Borouge, a joint venture between Abu Dhabi National Oil Company and European plastics giant Borealis, has signed a $1.39 billion revised contract with Technicas Reunidas for the expansion of its Ruwais petrochemical complex in Abu Dhabi.
The revised contract changed the terms of the deal from an open book estimate to a fixed lump sum turnkey contract for the Borouge 2 expansion project. The utilities and offsite contract includes the supply by Tecnicas Reunidas of the main auxiliary systems and interconnections for the expanded petrochemical complex.
Tecnicas Reunidas is a global engineering and construction company, focusing on oil and gas production, refining and petrochemicals and power generation projects.
“Upon the completion of Borouge 2 in 2010, Borouge’s production capacity will triple to over two million tons of polyolefins. This will enable Borouge to supply its customers with high performance and value added products for an increasingly wide range of applications in all its target markets,” Abdulaziz Alhajiri, Borouge Abu Dhabi Polymers CEO said in a press statement on Saturday.
The expanded Ruwais plant when completed will be able to more than triple its production capacity to 2.5 million tonnes by mid-2010 from 650,000 tonnes.
The plant will produce annually 1.4 million tonnes of ethylene, 540,000 tonnes of polyethylene, and 800,000 tonnes of polypropolene.
Previously, Borouge chief executive William Yau said Borouge is reviewing its Borouge 3 expansion programme which aims to raise capacity to 4.5 million tonnes. “We are still in the feasibility stage and we hope to speed up the evaluation process,” implying that new market realities have to be incorporated in the final plan.
“We are still very optimistic, our growth expectations are high,” said Yau, adding the company is pushing through with its expansion plans in the Middle East, and is eyeing logistics hubs in South Asia and Southeast Asia.
Currently, Borouge is constructing a regional logistics hub in Shanghai, China which will have an annual capacity of 600,000 tonnes. It is already constructing a 50,000-tonne compounding plant also in Shanghai. Another hub is being set up in the province of Guangzhou with a capacity of 300,000 tonnes.
(Khaleej Times & Zawya)