Abu Dhabi National Oil Co. (ADNOC) has entered an agreement to purchase Mubadala Investment Co.’s (Mubadala) ownership stake in Borealis AG, a European leader in production of base chemicals, fertilizers, and mechanical recycling of plastics.
As part of the late-April agreement—which remains subject to customary closing conditions and regulatory approvals—ADNOC will acquire Mubadala’s entire 25% interest in Borealis to become co-owner alongside majority shareholder OMV AG (75%), ADNOC said.
The proposed transaction comes as part of ADNOC’s broader program to expand its international footprint in the growing chemicals and petrochemical sector, unlocking new opportunities in key markets where Borealis currently operates, particularly in Europe and the Americas, the UAE-based operator said.
In addition to supporting acceleration of its global downstream and industrial growth program, the planned acquisition would further expand ADNOC’s existing partnership with Borealis, with whom it shares joint ownership of Abu Dhabi Polymers Co. Ltd. (Borouge).
The acquisition stake in Borealis also would complement ADNOC’s global strategic growth and investment approach, reinforcing its aim to serve as a catalyst for responsible, sustainable investment and value creation for Abu Dhabi and the UAE as it continues its transformation into an integrated, global energy operator, the company said.
Details regarding a timeframe for when the proposed transaction might be completed were not revealed.
Expansion
ADNOC’s ongoing expansion initiatives in the petrochemicals sector currently includes the newly commissioned fifth polypropylene plant (PP5) at Borouge’s integrated polyolefins complex in Ruwais, about 250 km west of Abu Dhabi City, UAE (OGJ Online, Mar. 21, 2019). Borouge also recently let a series of major contracts for its November 2021-approved fourth expansion of the site’s integrated polyolefins complex that—scheduled to become operational by yearend 2025—will boost the operator’s Ruwais sitewide production capacity of polyolefins—including polyethylene and polypropylene—to 6.4 million tonnes/year to make it the largest single-site polyolefins complex in the world (OGJ Online, Nov. 17, 2021).
Following startup, ADNOC previously said the Borouge 4 plant also will enable the next phase of growth of Ruwais’ broader industrial complex by allowing the Borouge partnership to supply feedstock to the TA’ZIZ Industrial Chemicals Zone, one of three special industrial ecosystems under development by ADNOC and UAE’s ADQ that specifically aims to anchor a host of petrochemical projects by both domestic and outside investors.
Robert Brelsford | Downstream Editor
Robert Brelsford joined Oil & Gas Journal in October 2013 as downstream technology editor after 8 years as a crude oil price and news reporter on spot crude transactions at the US Gulf Coast, West Coast, Canadian, and Latin American markets. He holds a BA (2000) in English from Rice University and an MS (2003) in education and social policy from Northwestern University.
