Samsung A&E bags $1.7bn deal to build UAE’s first methanol plant

SINGAPORE (ICIS)–Abu Dhabi Chemicals Derivatives Co (TA’ZIZ) said on Monday it has awarded South Korea’s engineering firm Samsung E&A a $1.7 billion contract to build the first methanol plant in the UAE, which is slated to be completed in 2028.

The plant, to be built in Al Ruwais Industrial City in western Abu Dhabi, will have a capacity of 1.8 million tonnes/year, TA’ZIZ said in a statement posted on the website of its parent firm Abu Dhabi National Oil Co (ADNOC).

TA’ZIZ is a joint venture (JV) between ADNOC and sovereign wealth fund ADQ.

Samsung A&E was formerly known as Samsung Engineering.

“The [methanol] plant will enhance the UAE’s position as a leader in sustainable chemicals production and strengthen TA’ZIZ’s role in enabling ADNOC’s global ambition to lead the chemicals sector,” TA’ZIZ CEO Mashal Saoud Al Kindi said.

The company said that the plant will be “powered by clean energy from the grid, making it one of the world’s most energy-efficient methanol plants”.

Set up in 2020 to develop industrial projects and diversify the economy away from oil in the UAE, TA’ZIZ is expected to produce 4.7 million tonnes/year of chemicals by 2028 in its initial phase, including methanol, low-carbon ammonia, polyvinyl chloride (PVC), ethylene dichloride (EDC), vinyl chloride monomer (VCM), and caustic soda.

Several of these chemicals will be produced for the first time in the UAE.

ADNOC is moving in the specialty chemical space as part of its growth.

On 1 February, ADNOC announced that it is in talks with Austrian petrochemical firm OMV to acquire Canada’s Nova Chemicals from Mubadala, another Abu Dhabi sovereign wealth fund.

If the acquisition goes through, a new global polyolefins group combining Nova Chemicals, Borealis, and Borouge will be formed, it said.

Borealis is a 75:25 joint venture between OMV and ADNOC, while Borouge is jointly owned by ADNOC (54%) and Borealis (36%).