The first phase of Abu Dhabi-based Taziz’s chemicals project is on track despite disruption by the Iran war and its ammonia plant is nearing completion, chief executive Mashal Al Kindi has said.
“Phase one has two key components: three chemical projects of ammonia, methanol and polyvinyl chloride and on infrastructure, we have [a] port, a terminal and a centralised utilities plant,” he told The National.
The latter is a joint venture between Adnoc and Taqa, he added.
Phase one is proceeding, with the ammonia plant close to completion.
Iran launched attacks on energy infrastructure across the Middle East after war broke out with the US and Israel on February 28. Adnoc's Habshan gas plant and Bab field were among the UAE energy centres targeted.
Taziz, founded in 2020 as a joint venture between Adnoc and Abu Dhabi's investment and holding company ADQ, is a manufacturing, industrial services, logistics and utilities company that supports the production of chemicals and transition fuels.
The company's production goal is 4.7 million tonnes a year (mtpa) of chemicals once the first phase of construction is completed in 2028.
In terms of output, phase 1 will comprise a 1 mtpa ammonia plant, a 1.8 mtpa methanol plant and 1.9 mtpa of marketable products from its integrated polyvinyl chloride (PVC) complex.
The chemical products will strengthen the local supply chain as well as cater to global demand, Mr Al Kindi said.
“[The] UAE is quite strong in terms of construction, and PVC is a key component of construction. We already have around 150,000 to 200,000 tonnes per annum of imports of PVC, so we can easily replace all of these PVC with domestic supply.”
It also opens opportunities to build products with new investments and bolster the local supply chain, he added.
Caustic soda, a component used in the manufacture of aluminium, will also be produced at the PVC complex for supply to Emirates Global Aluminium, the UAE’s largest industrial company outside the oil and gas sector.
Ammonia is an energy carrier and an important transition fuel. There is a high demand for it, especially in Asia, said Mr Al Kindi. Methanol is also used to produce hundreds of end products, such as acetic acid, which is used by many businesses in the UAE.
“It is a twofold approach, global demand … market share capture as well as creating value chains in the UAE,” Mr Al Kindi said.
The Taziz Methanol Company, a joint venture between Taziz and Proman, said last week it had achieved financial close on $2 billion financing for the UAE’s first methanol plant in Al Ruwais Industrial City, with the participation of regional, European and Asian financial institutions.
“This financing is very crucial for us and gives a testimony to the world that these projects are not just ambitious projects but actually quite bankable,” Mr Al Kindi said.
“It's showing that the banks have confidence and the set-up that we have is bankable and is robust and [gives a] return.”
Last week, Taziz also signed global offtake and feedstock agreements worth $28.5 billion to support chemicals production in the UAE and boost industrial growth.
The flurry of agreements includes deals with Adnoc and Swiss-headquartered Proman for methanol, with EGA for caustic soda, and with Mitsubishi Corporation for ethylene dichloride, vinyl chloride monomer and caustic soda.
India's Sanmar Group, as well as Houston-based Tricon and Vinmar, are also involved in the deals.
“We are basically securing our feedstock for a long term locally [with Adnoc Gas for the supply of gas for Taziz], and we're also securing offtake and selling our products internationally and locally.”
Taziz is planning to announce more sales deals in future as it expands its chemicals portfolio.
Last year, Taziz announced two long-term sales agreements of up to 10 years with Sanmar Group for the supply of key raw materials used in the manufacture of industrial and chemical products.
It will supply Sanmar with more than 350,000 tonnes per annum of ethylene dichloride (EDC) and vinyl chloride monomer (VCM) as part of the agreement. The chemicals are used in the production of PVC, one of the world's most widely used plastics.
“More financing, more developments happening on maturing phase one and you'll definitely hear future projects and developments in terms of expanding our chemicals portfolio,” Mr Al Kindi said.
