July 24, 2024 [Chem Analyst]- Borouge Plc, a prominent petrochemicals company known for its innovative polyolefins solutions, has announced an accelerated growth strategy in Asia through a strategic consortium. This consortium, which includes Borouge, ADNOC, and Borealis, has signed a Project Collaboration Agreement with China’s Wanhua Chemical and its subsidiary, Wanrong New Materials (Fujian). The consortium plans to develop a speciality polyolefins complex in Fuzhou, Fujian Province, capable of producing 1.6 million tonnes per annum (MTPA) of speciality polyolefins using Borealis’ proprietary Borstar® technology and Borouge’s sales network. A 50:50 Sino-foreign joint venture with Wanrong New Materials is proposed, pending regulatory approvals.
His Excellency Dr. Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology, Managing Director and Group CEO of ADNOC, and Chairman of Borouge, attended the signing ceremony in Beijing, alongside Liao Zengtai, Chairman of the Board of Wanhua Chemical, and Fuzhou Mayor Wu Xiande. Hazeem Sultan Al Suwaidi, CEO of Borouge PLC, signed on behalf of Borouge as part of the consortium, while Kou Guangwu, CEO of Wanhua Chemical Group, signed on behalf of Wanhua Chemical.
Hazeem Sultan Al Suwaidi, Chief Executive Officer of Borouge, stated: “This strategic growth initiative enhances the strong economic relationship between the UAE and China, aiming to generate value for Borouge shareholders through accelerated expansion in China. The proposed complex will utilize the strengths of our partners and majority shareholders, who contribute significant capital, world-class technology, innovation, technical expertise, and extensive logistics and customer networks. We look forward to working with our partners to promptly deliver a sustainable feasibility study that aligns with our commitment to reduce emissions.”
This strategic initiative will strengthen Borouge’s premium positioning in the rapidly growing market for high-quality differentiated materials and marks a significant milestone in its international growth ambitions. As part of the consortium, Borouge aims to enhance its presence in China, the world’s largest and fastest-growing polyolefins market, where petrochemical self-sufficiency is a priority, further solidifying the company’s strong market position.
The proposed project will leverage the industry and commercial expertise of Borouge and Borealis, along with technology, supply-chain, and logistics synergies across the ADNOC Group. It will also benefit from Wanhua Chemical’s robust track record and network in the Chinese market, China’s competitive construction and energy costs, and its expedited execution timelines. The partners are committed to achieving net-zero emissions and developing products that support the circular economy. They plan to power the new specialty polyolefins complex with 100% zero-carbon electricity, supported by the local government.
The project’s final structure and financial commitments will be determined upon the completion of the feasibility study, which will also investigate the implementation of artificial intelligence (AI) solutions to enhance automated plant operations.
Asia is a key hub for polyolefin demand, with China representing 40% of global consumption. Borouge has established a strong presence in China with an application center and a compounding center based in Shanghai. In 2023, nearly 30% of Borouge’s revenue came from China, highlighting the company’s dedication to robust growth in the region. Borouge supplies high-quality materials for a range of customer sectors, including infrastructure, renewable energy, electric vehicles, and advanced packaging.
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