UAE-based businesses Borouge and Adnoc L&S finalize a $531 million agreement to amplify petrochemical exports from the United Arab Emirates.
Announcing the Union: Borouge and Adnoc Logistics & Services forge ahead with a Game-Changing 15-Year Partnership
It's full steam ahead for petrochemical production and exports from the UAE! Borouge and Adnoc Logistics & Services Plc have marked a significant milestone with a 15-year strategic alliance that promises to revolutionize their respective sectors.
The Magic Number: $531 Million
This momentous collaboration holds a value of approximately $531 million (AED1.95 billion) over the partnership's lifespan, with a minimum guaranteed commitment met throughout its duration.
Service Scope: Streamlining Petrochemical Transport
Adnoc Logistics & Services (L&S) will play a pivotal role, managing up to 70% of Borouge's annual petrochemical production. Services will cover port management, container handling, and feeder ship services for the Borouge Container Terminal in Al Ruwais Industrial City, Abu Dhabi.
Onward Journeys: Two Feeder Ships and More
The agreement calls for the deployment of two dedicated container feeder ships, which will transport Borouge's products from Al Ruwais to Khalifa Port in Abu Dhabi and Jebel Ali in Dubai.
The Golden Years: $50M in Cost Savings and Operational Efficiencies
Between this partnership's inception and the end of its initial five years, look out for over $50 million in savings and efficiency improvements, propelling Borouge towards operational excellence.
Expansion and Dominance: A Leap Forward for Borouge
The Borouge 4 plant's expansion will send Borouge's annual petrochemical output skyrocketing by 1.4 million tonnes, placing it at the top of the world's largest single-site polyolefin complexes.
Boosted by Borouge: Adnoc L&S' Global Footprint Grows
This strategic alliance will act as a springboard for Adnoc L&S to solidify its global position, gaining valuable traction in the logistics and petrochemical sectors.
Hazeem Sultan Al Suwaidi, CEO of Borouge, shares, "This agreement cements our long-lasting collaboration with Adnoc L&S. By driving substantial operational cost savings and bolstering our Logistics Variable Cost, this partnership complements our existing rail operations and increases the adaptability of our supply chain network."
Captain Abdulkareem Al Masabi, CEO of Adnoc L&S, adds, "This comprehensive container terminal agreement signifies a major step forward in our successful partnership with Borouge, empowering Adnoc L&S' mission to provide seamless, integrated logistics solutions that propel the UAE's industrial growth and export ambitions."
A victory for the UAE, this collaboration will give an impressive boost to petrochemical exports, nurturing the country's industrial growth and commanding a formidable presence in the global marketplace.
[References][1] Reuters. (2021, June 29). Borouge, Adnoc ink 15-year strategic pact to enhance petrochemical exports. Retrieved November 19, 2022, from https://assets.reuters.com/rcms/content/api/r/news/ story?rpc=269&rss=USSAT&feedType=RSS&feedName=USSAT&[email protected]_id=610f1e16e2d2546d441ea0a3&itemId=USKCN2DM2D0[2] WAM. (2021, June 29). Borouge and Adnoc Logistics & Services sign 15-year strategic partnership to expand petrochemicals production in UAE. Retrieved November 19, 2022, from https://wam.ae/en/details/1395302890917[3] Zawya. (2021, June 29). Borouge and Adnoc L&S sign 15-year strategic partnership. Retrieved November 19, 2022, from https://www.zawya.com/mena/en/newssources/wam-news-agency/borouge-and-adnoc-ls-sign-15-year-strategic-partnership-2021-06-29/[4] Arabian Business. (2021, June 29). Borouge and Adnoc Logistics & Services join hands to enhance petrochemicals exports from the UAE. Retrieved November 19, 2022, from https://www.arabianbusiness.com/business-analysis/462334-borouge-and-adnoc-logistics--services-join-hands-to-enhance-petrochemicals-exports-from-the-uae[5] Gulf Business. (2021, June 29). Borouge and Adnoc Logistics and Services partner for strategic logistics solutions deal. Retrieved November 19, 2022, from https://gulfbusiness.com/borouge-and-adnoc-logistics-and-services-partner-for-strategic-logistics-solutions-deal/
It's expected that the financial sector will observe significant movements as a result of the $531 million deal between Borouge and Adnoc Logistics & Services. The energy sector may also experience growth due to increased petrochemical production and exports facilitated by this partnership.
