Firms in Abu Dhabi work towards a circular economy for the plastics industry


Abu Dhabi has set its sights on diversifying its economy at a rapid pace in the next decade, setting aside hundreds of square kilometres of land for the development of new interdependent industries. Various elements are being drawn together to create a chemical industries hub on part of the 410-sq-km Khalifa Industrial Zone Abu Dhabi (KIZAD), with billions of dirhams of investment being made. The emirate may owe its fortune to the extraction of oil and gas, but it is planning to boost its wealth by mixing raw materials such as brine, bauxite ore and lime in manufacturing processes that will see KIZAD factories make a wide range of products in Abu Dhabi in the near future, from precision components for automotive and aerospace industries to pipes for construction and fabrics for fashion.


In February 2018 the zone’s management announced that the jointly owned UAE-Omani company Shaheen Chem Investments would invest Dh4bn ($1.1bn) in building a chemical factory on 330,000 sq metres of leased land in KIZAD, as well as a dedicated port terminal at the deepwater Khalifa Port. The new plant will facilitate the import of raw materials by sea, with key customers for its products on its doorstep. In its first phase, the factory is expected to produce 130,000 tonnes of caustic soda and 160,000 tonnes of ethylene dichloride per year.

Common salt (sodium chloride) is the raw material used to produce caustic soda (sodium hydroxide) using electrolysis, with 2.25 tonnes of 50% caustic soda produced with each tonne of chlorine. Ethylene, a flammable hydrocarbons gas occurring in natural gas and crude oil, will be synthesised with the chlorine in a subsequent process to produce ethylene dichloride. This is a precursor chemical used to manufacture vinyl chloride, which in turn is used to make polyvinyl chloride (PVC). In the second phase of construction at the plant, caustic soda output will double, and the factory will make both vinyl chloride and PVC, as well as sell it to third parties. The Shaheen Chem factory will be the first in the UAE to produce ethylene dichloride and will significantly boost caustic soda production.

Lime & Soda

The new chemical plant is being built next to the Emirates Global Aluminium (EGA) works and its new $3.3bn Al Taweelah alumina refinery, which is under construction and due to open in 2019. Bauxite ore imported through Khalifa Port will be separated at the new refinery using a hot solution of lime and caustic soda. The mixture will then be pumped into high-pressure containers and heated using the Bayer process. The caustic soda dissolves the alumina, which precipitates from the saturated solution. The alumina is then washed and heated to drive off water, leaving the dried white powder, alumina. That product will be used in EGA’s aluminium smelter at KIZAD.

The Shaheen Chem factory will supply all of its caustic soda to EGA for a period of 15 years. Al Taweelah, in turn, is expected to produce 2m tonnes of alumina per year, equivalent to roughly 40% of EGA’s current requirements. “The construction of a caustic soda plant next to our alumina refinery guarantees our supply of this vital raw material at competitive prices for years to come,” managing director and CEO of EGA, Abdulla Kalban, said on announcing the new Shaheen Chem factory. “We now look forward to building our plant at KIZAD to supply EGA with the caustic soda it needs. We are also excited to become the first producer of ethylene dichloride in the UAE, and to later bring vinyl chloride and polyvinyl chloride production to the country,” added Shaheen’s chairman, Rashed Al Suwaidi.

Catalyst For Growth

The main developer and operator of KIZAD, Abu Dhabi Ports, is also responsible for 11 commercial, logistics, community and leisure ports in the emirate. Transport and logistics are key to the industrial zone’s offering, with Khalifa Port at the heart of a transport hub served by road, air, sea and, in the near future, rail services. Abu Dhabi Ports’ most recent data showed that it contributed 3% of the emirate’s non-oil GDP in 2016 at Dh17bn ($4.6bn).

“The target is for this contribution to increase to 15% by 2030, which is a huge leap, but also indicative of the Abu Dhabi government’s ambition,” Aseeb Abdul Khader, commercial development manager of Abu Dhabi Ports, told OBG. In addition to its connections to the outside world, KIZAD is designed to promote the clustering of associated business functions. The zone earmarked for chemical and plastics industries is flanked by modular engineering industries, construction products, food products and processing, with packaging and pharma industries sharing the same block.

Petrochemical Companies

New entrants to the chemicals industry will join and complement the emirate’s existing petrochemicals businesses. Abu Dhabi National Oil Company (ADNOC) is involved in a number of important downstream ventures in addition to its upstream oil and gas activities. ADNOC’s 50:50 joint venture with the Austrian company Borealis, known as Borouge, operates the world’s largest integrated polyolefins complex. Mubadala Investment Company, a government-owned entity, owns 64% of Borealis, with the remaining 36% of equity held by Austria’s OMV. Together, Borealis and Borouge employ 6600 staff and operate in 120 countries, with an annual production capacity of 8m tonnes of polyolefin. In July 2017 ADNOC and Borealis signed a framework agreement to develop two key projects: the Borouge 4 complex, to be integrated with ADNOC’s subsidiary, Abu Dhabi Oil Refining Company (Takreer), at Ruwais; and a new polypropylene plant (PP5), to be integrated into the existing Borouge 3 complex, started in 2016.

The Borouge 4 complex will include a mixed feedstock cracker with downstream derivatives units for both polyolefin and non-polyolefin products. It is due to open in 2023 and will increase output capacity from 4.5m tonnes per annum to almost 10m, helping ADNOC reach its 2025 target of 11.4m. The PP5 plant will be based on Borealis’ proprietary Borstar technology. The framework agreement has enabled ADNOC and Borealis to instigate the front-end engineering and design phase for Borouge 4, and to commence tendering for the engineering, procurement and construction of the additional polypropylene plant.


In October 2017 ADNOC brought together many of its products and services under a unified brand, and at this point Ruwais Fertilizer Industries changed its name to ADNOC Fertilizers. The fertiliser firm has been producing urea, the world’s most widely used nitrogen fertiliser, since 1980, when the company was formed as a joint venture, with ADNOC owning 67% and French energy giant Total holding 33%. In 2013 a second fertiliser plant was completed, allowing production volumes to increase significantly. ADNOC is among the world’s largest exporters of sulphur, a by-product of the processing of sour natural gas. In December 2017 the company signed a long-term supply agreement with the OCP Group of Morocco to last until 2025. ADNOC exported 2m tonnes of sulphur to Morocco in 2016, and the company and its partners produce 6m tonnes annually that are exported from its Ruwais handling facility. According to the Gulf Petrochemicals and Chemicals Association, a group representing more than 230 companies, ADNOC aims to double its current sulphur output as new gas processing facilities open.


In November 2017 the Spanish global energy company Cepsa, a subsidiary wholly owned by Mubadala, signed an agreement with ADNOC to build a new complex producing linear alkylbenzene at Ruwais. Linear alkylbenzene is the main raw material used to make biodegradable detergents and Cepsa is the world’s leading producer, manufacturing 600,000 tonnes per annum, 15% of global production. Feedstock for the new venture will come from ADNOC’s Ruwais refinery, while Cepsa will bring technical and market know-how to the partnership. The new complex is slated to be operational by 2022.

Circular Economy

Petrochemical and chemical companies in Abu Dhabi are committed to creating a circular economy for the plastics industry to mitigate against the environmental impact of discarded containers and packaging. It was revealed at the ninth GPCA PlastiCon in March 2018 that the UAE has the world’s fourth-highest polyethylene terephthalate (PET) consumption rate per capita, with its residents using an average of 450 bottles a year. Just 6% of these were recycled in 2018. Establishing a circular economy would involve the collection and processing of these discarded products in order to be recycled.

The conference was opened by Borouge CEO, Ahmed Omar Abdulla, who is also chairman of the GPCA Plastics Committee. “More and more polymer producers in the region are strongly advocating a commitment towards a plastics circular economy, which foresees that plastics do not end up in our oceans or landfills, but rather that plastics are separated from fossil fuels to create an effective after-use economy,” Abdulla told the conference. He added that a Borouge plastics circular economy programme had been established, to study the end-of-life application of its products, and to promote the reuse and recycling of plastics globally.

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