InterviewIPIC aiming to be global petchem leader in 5 years - MD

17 November 2009 14:10  [Source: ICIS news]

LONDON (ICIS news)--Abu Dhabi’s International Petroleum Investment Company (IPIC) is aiming to triple in size over the next five years through acquisitions and organic growth, its managing director said on Tuesday.

Khadem Al Qubaisi said he wanted to increase the firm’s production capacity from roughly 10m tonnes/year today to 30m tonnes/year within five years, making it a global leader in petrochemical production.

“I want IPIC to be a multinational hub for the petrochemicals industry. I’m looking to grow organically through my companies such as [Austrian polyolefins group] Borealis and [Canada’s] NOVA Chemicals – plus through my targets and the establishment of more joint ventures.

“There will be more plants in Abu Dhabi plus expansions to existing plants. I’m interested in buying more petrochemical companies worldwide.”

Al Qubaisi revealed earlier on Tuesday that IPIC expects to acquire a major European petrochemical company by the first quarter of 2010.

He said there would inevitably be a shift in ownership and production from Europe and the US towards the Middle East.

“In the Middle East we’ve got the feedstocks and markets not far away such as China and the Far East. It’s reasonable to assume there will be a shift. In Europe, for example, markets are mature and they have problems with feedstocks. It’s better for their big companies to come to the Middle East and benefit from cheap feedstocks.”

He said IPIC was committed to maintaining its European manufacturing sites: “Our policy at Borealis is to restructure existing sites, with any expansions happening in Abu Dhabi, not in Europe. That is unless there are unique opportunities for plants such as integrations with oil refineries or availability of cheap feedstocks.”

IPIC would allow its acquisitions to maintain their identities and would not merge them, Al Qubaisi said.

“Different companies have different technologies, different marketing styles. NOVA won’t lose its identity as we don’t want problems with competition authorities and so on. Everything will remain as it is. We are not thinking about merging or consolidating these companies.”

In Europe, IPIC already owns a 48% stake in Spanish energy and chemical group Cepsa, 64% of Borealis, and a 19% stake in Austrian oil and chemical group OMV.

This year it acquired 100% of NOVA Chemicals.

In Abu Dhabi it aims to bring on stream 4m tonnes/year of petrochemical capacity at its Borouge facility within two to three years. It is also investing in Chemaweyaat, a $10bn petrochemicals development that will boast a 1.4m tonne/year naphtha cracker, which is due on stream in 2014.

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By: Will Beacham
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