Shearman & Sterling has advised the Abu Dhabi National Oil Company (ADNOC) on a strategic partnership that confirms a $6.2 billion investment agreement between ADNOC and Borealis AG to build the fourth Borouge facility - Borouge 4 - at the polyolefin manufacturing complex in Ruwais, Abu Dhabi, United Arab Emirates (UAE). The world-scale expansion confirms both partners’ commitment to the growth of Borouge and to support chemical production and advanced manufacturing and industry in Ruwais, a key pillar of Abu Dhabi and the UAE’s technology, innovation and industrial development strategy. Borouge produces crucial industrial raw materials which are exported to customers globally and used by local companies, boosting local industrial supply chains.
Borouge 4 will capitalize on the projected growth in customer demand for polyolefins, driven by their use in manufactured products in the Middle East, Africa and Asia. The facility will also enable the next phase of growth at the Ruwais Industrial Complex by supplying feedstock to the TA’ZIZ Industrial Chemicals Zone. Borouge 4 will have an industry-leading focus on sustainability leveraging the capabilities of both shareholders.
The new Borouge 4 facility covers an area equivalent to almost 500 football pitches and will produce enough polyolefins annually to make enough pipes to supply water to 35 million households. Borouge’s value-add materials are used to manufacture a diverse range of products including industrial-grade pipes, cables, films and personal protective equipment.
The first Borouge facility, producing 450,000 tons of polyethylene per annum was commissioned in 2001. Borouge 2 and Borouge 3 took capacity to 2 million tons and 4.5 million tons of polyethylene and polypropylene per annum in 2010 and 2014 respectively. Borouge 4 will boost the company’s annual polyolefin production to 6.4 million tons, making Borouge the world’s largest single-site polyolefin facility.
The Shearman & Sterling team below included associate Nicole Chatrath (Singapore-PDF).