ADNOC, Borealis to list 10% stake in Borouge; continues to monetize assets

Abu Dhabi National Oil Co and Borealis, in which the national oil producer has bought a 25% stake, plan to list 10% of their petrochemical joint venture, Borouge, on the Abu Dhabi Securities Exchange in June as the UAE continues to monetize its energy assets.

UAE-based Borouge, the biggest petrochemical company in the country, will be ADNOC's fourth sale of a stake in a unit through an initial public offering, ADNOC said in a May 18 statement. ADNOC said last month it had taken a 25% interest in Borealis from the UAE sovereign wealth fund Mubadala Investment Co. Mubadala holds a 24.9% stake in Austria's OMV, which will own the remaining 75% interest in Borouge.

"Through Borouge and our recently announced 25% equity investment in Borealis, ADNOC is poised to capitalize on the significant industrial and consumer-led growth in the petrochemicals sector over the coming decades," ADNOC CEO Sultan al-Jaber said in the statement. "ADNOC continues to consistently unlock and maximize value across its integrated upstream and downstream asset base in order to drive sustainable growth for the benefit of Abu Dhabi and the UAE."

Since 2019, ADNOC has been monetizing its oil and gas assets as it seeks to unlock cash to fund strategic projects, which include increasing oil output capacity to 5 million b/d by 2030 from around 4 million b/d currently.

ADNOC is forging ahead with an expansion of its hydrocarbons and low-carbon businesses under a plan to spend Dirhams 466 billion ($127 billion) over 2022-2026.

The last five-year capital expenditure plan was for $122 billion.

Fourth sale

ADNOC has already sold stakes in its fuel retail arm ADNOC Distribution, ADNOC Drilling and fertilizer company Fertiglobe as it seeks to raise money to spend on growth projects.

Earlier this year, ADNOC and Borealis announced the start up of a new polypropylene unit that will boost total polymer capacity of polyolefins by 11% at Borouge, ahead of a 2024 launch of a $6.2 billion expansion.

The commencement of operations at its fifth PP unit will boost the commodity's production capacity by 25% to 2.24 million mt/year and its total polymer capacity of polyolefins by 11% to 5 million mt/year.

Expected to become operational in 2025, the Borouge 4 project includes the construction of a 1.5 million mt/year ethane cracker and two polyethylene plants. It will make the site the world's largest single-site polyolefin complex at 6.4 million mt/year.

At the Asian close on May 17, Platts had assessed PP Injection grade CFR Far East Asia at $1,165/mt, unchanged on the day, data by S&P Global Commodity Insights showed.