Taweelah to host chemical city

Taweelah to host chemical city
Chris Stanton The National

ABU DHABI // The capital’s Kalifa Industrial Zone, which already includes plans for a deep-water port and the world’s largest aluminium smelter, will also play host to the biggest integrated plastics and chemicals complex on the planet, officials said yesterday.

The multi-billion dirham Chemicals Industrial City, which will produce basic plastics and chemicals, is part of the emirate’s drive to build a viable petrochemicals industry and diversify its economy away from simple crude oil exports.

“The location of this large-scale petrochemical complex is a major milestone for the development of the industrial cluster at the Khalifa Industrial Zone,” Ahmed al Calily, the chief executive and managing director of the Abu Dhabi Ports Company said in a statement.

The backers of the new complex, the International Petroleum Investment Company (Ipic), a Government investment fund, and Borealis, a chemical company based in Austria that is majority-owned by Ipic, chose the Khalifa port over Abu Dhabi’s existing petrochemical centre in Ruwais, in the Western Region, to take advantage of easy access to global markets.

The first stage of the complex, to be called Chemaweyaat Complex 1, is scheduled to be completed by 2013.

“It provides us not only with the physical space for major development, but also helps us to export our future production efficiently,” said Mohamed al Azdi, the chairman of the Chemaweyaat development committee.

Chemical Industrial City will produce seven million tonnes of chemicals by 2013, which Ipic has said would make it the largest plant of its kind in the world. At the moment, the biggest chemical complex is BASF’s Lunwigshafen site in southwestern Germany.

Before yesterday’s announcement, the site for Chemicals Industrial City was undisclosed but recent media reports suggested that Borealis, Ipic, and the Abu Dhabi Investment Council, a third backer of the complex, were leaning toward the Taweelah site over Ruwais, where the Abu Dhabi National Oil Company’s oil terminal, major refinery and plastics plants are all located.

The site in Taweelah will be near Abu Dhabi’s main power stations, the new Khalifa deepwater port and the world’s largest aluminium smelter, which is being built by Emirates Aluminium.

The statement suggested that Abu Dhabi’s planners see the complex as a catalyst for the development of other chemical plants that will use Chemicals Industrial City’s products as feedstock for their own operations.

“We also look forward to attracting further downstream industries to Taweelah through the broad range of chemical and petrochemical products to be produced there,” Mr Azdi said.

Officials said the chemical plant would attract spin-off industries to Taweelah.

“Chemaweyaat, as an anchor tenant will attract additional investments from all parts of the supply chain and will create a viable chemical and petrochemical cluster,” Mr Calily said.

The Chemicals City complex will include facilities for producing plastics from propylene and ethylene, a reformer to make gasoline, and sophisticated machinery to make xylene, benzene, cumene, phenol and their derivatives. All are basic ingredients used in the modern chemical industry.

The complex will also have a large naphtha cracker, which will provide the plant with feedstock derived from a component of crude oil.

The naphtha cracker is crucial because it means the plant will differ substantially from existing plastic plants in Ruwais since it will be fed by crude oil instead of natural gas. The country is facing a shortage of gas due to booming demand for electricity but has ample supplies of naphtha.

The plants in Ruwais are owned by Borouge, which was launched seven years ago as a joint venture between Adnoc and Borealis. Borouge and Borealis both produce plastics but avoid competing against each other by dividing the world into two distinct markets. Borealis sells to Europe while Borouge concentrates on the Middle East and Asia.