IPIC, Abu Dhabi’s International Petroleum Investment Company, made a very shrewd acquisition of Nova at the bottom of the market, earlier this year. And now they are apparently in talks with a number of major chemicals companies about joint ventures and possibly acquisitions.
The key for IPIC is to obtain technology, with which they can go further downstream. At the moment, their focus is on the ethylene/propylene chain via Borouge, the JV with Borealis (36% owned by OMV). The driver is the IPIC decision to develop the enormous Chemaweyaat project, scheduled to start coming online in 2014.
This will be based on liquid feeds, rather than ethane. It will therefore allow Abu Dhabi to grow their propylene position, and to move into the other ‘building block’ products, such as butadiene, benzene and paraxylene for the first time. In turn, this drives a need for derivative technology, such as polycarbonates, where they are reportedly talking to leading player, Bayer MaterialScience about a JV.
Abu Dhabi has the world 5th largest oil and gas reserves. Its increasing interest in petchems is another sign of the Middle East’s growing role in the chemical industry.