Adnoc confirms increased focus on downstream industry

Abu Dhabi National Oil Company, the UAE’s biggest producer of crude oil, affirmed its commitment to the downstream hydrocarbon industry as it boosts production to meet growing global demand for high-value refined and petrochemical products. "The steps we have taken so far have laid a solid foundation for powering the next phase of our growth," said Dr Sultan Al Jaber, Minister of State and Adnoc Group chief executive . He was speaking at the CERAWeek conference in Houston on Tuesday. “And the biggest opportunity for that growth is downstream, particularly in petrochemicals, where demand is expected to climb 150 per cent by 2040, driven by the growth economies of Asia.” The UAE is the fourth largest producer in the Opec and accounts for 6 per cent of global reserves. Abu Dhabi has said it wants to double its domestic output of petchems by two-and-a-half times to 11.5 million tonnes a year by 2025 as part of the emirate's plan to diversify its sources of income under its 2030 growth strategy. At the same time, the capital is planning to increase its portfolio of petchems assets globally. Dr Al Jaber also announced plans to host a Downstream Investment Forum in Abu Dhabi in May, during which Adnoc will showcase investment opportunities. “We will unveil significant co-investment opportunities for all partners, ready to work alongside us at a special event this coming May as we transform our downstream portfolio domestically and internationally.” _______________ Read more: _______________ At the centre of Adnoc's downstream strategy is its construction of what is intended to be the world's largest integrated refining and chemical site in the world in Ruwais, which will produce 14.4 million tonnes of petchems products annually by 2025. In January, Adnoc signed a three-year deal with Lotte Chemical Titan to supply to the Malaysian petchems company up to 1 million tonnes of naphtha a year. As well as shifting to downstream. Adnoc is also striking long-term deals, especially in Asia where demand for such products is on the rise. Last year, the producer said it was ramping up production of high-grade polymer products to meet demand from China’s car industry as well as the country’s investment in gas and electricity infrastructure. Demand in China and Asia for petchems and plastics, including lightweight automotive components, essential utility piping and cable insulation, is forecast to double by 2040, according to Adnoc. The past year has seen Adnoc align its group of companies under a single, unified brand, and open up opportunities across its upstream and downstream businesses to new categories of partners and investors, including public and private financial institutions, Dr Al Jaber told delegates in Houston. The company tapped global capital markets last year for the first time, issuing a $3 billion bond against one of its large crude oil pipelines, as well as floating shares in its retail and distribution subsidiary Adnoc Distribution on Abu Dhabi’s stock market. Dr Al Jaber said as well as bolstering its downstream businesses, Adnoc was also enhancing its upstream business and that the company will make new blocks available for commercially competitive bidding to both existing partners and new ones.