Borouge Begins FEED Stage of 2.5 Million-Ton B3 Polyolefins Project in Abu Dhabi

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Researched by Industrial Info Resources (Sugar Land, Texas)--Borouge Corporation (Abu Dhabi, United Arab Emirates), a 60:40 joint venture company between state-owned Abu Dhabi National Oil Company (ADNOC) (Abu Dhabi, United Arab Emirates) and Borealis AG (Vienna, Austria), recently announced that it has entered the front-end engineering and design (FEED) stage of the Borouge B3 project. WorleyParsons (ASX:WOR) (North Sydney, Australia) is acting as the project's consultant.

Borealis is jointly owned by OMV AG (WBAG:OMV) (Vienna), and International Petroleum Investment Company (Abu Dhabi), which is wholly owned by the government of Abu Dhabi.

Following the feasibility study conducted last year, the B3 project at Ruwais, 250 kilometers west of Abu Dhabi, obtained a go-ahead for the FEED stage. When it comes online in the fourth quarter of 2013, the B3 project will increase the production capacity of polyolefins by 2.5 million tons per year, bringing the total production capacity at Ruwais to 4.5 million tons per year.

The project will take advantage of the excess feedstock resulting from the expansion of ADNOC's refinery and gas processing operations and enable Borouge to meet the increased demand for polypropylene and polyethylene in the Middle East and Asia. Further, by adding the production capability for low-density polyethylene, the B3 project will enable Borouge to expand into the wire and cable market. Also included in the B3 project are second-generation units for the company's Borstar polypropylene and polyethylene products, an ethane cracker, a butene unit, and various off-site utilities.

The B3 project will complement the ongoing $5.5 billion B2 project, which began in 2007 and is scheduled for start-up in 2010. The B2 project has a 1.5 million-ton-per-year ethane cracker, the world's largest olefins conversion unit with a capacity of 752,000 tons per year, two Borstar polypropylene plants with a combined capacity of 800,000 tons per year, and a 540,000-ton-per-year Enhanced Borstar polyethylene plant.

Borouge is also expanding its sales and marketing network further into Asia with the establishment of logistics hubs in Guangzhou and Shanghai in China, in order to provide better storage, packaging and logistics support for customers in the area. The contract for the Guangzhou hub, which is capable of handling 246,000 tons per year of value-added polyolefins, was signed in October 2008 with Enpro Supply Chain Management Limited (Guangdong, China).

In November 2008, Borouge announced plans to collaborate with Agility Logistics (Safat, Kuwait) to develop a 70,000-square-meter logistics hub in Shanghai, capable of handling 600,000 tons per year of polyolefins in the form of polymer granules shipped from Abu Dhabi in bulk containers. In addition, a 30,000-square-meter compound manufacturing unit (CMU) will be built at the site to produce 50,000 tons per year of plastic compounds for the automotive, electrical, domestic appliance, and power tool markets in the Shanghai region.

In February, Borouge announced that it signed a service contract with CWT Logistics Pte Limited (Singapore) to design, develop and construct a state-of-the-art warehouse and packaging facility in Singapore, capable of handling 330,000 tons per year of polyolefins shipped from Abu Dhabi.

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