Adnoc, CPC to invest $1b in mega
Quoting CPC chairman, Pan Wenent, the report states that a feasibility study is being undertaken right now and an agreement will be signed in one or two months. For Adnoc, which is in the process of expanding and diversifying its petrochemical production base, a joint venture of this kind would fit well with this strategy.
The two companies had, however, been exploring a more ambitious plan for a $6billion joint investment in Abu Dhabi, including a refinery, a cracker and downstream facilities. Pan was quoted as saying that both sides "have come to the conclusion that this would have been too big, too fast."
International Petroleum Investment Company (IPIC) Adnoc's international investment arm, was also reported to have expressed an interest in buying 20 per cent of CPC for $5 billion, but this, along with a proposed investment in CPC's affiliate, Kuo Kuang Petrochemical Technology, was now off the cards. Pan said that a proposal of this kind would only be considered if the state-owned company was privatized, and the chances of this happening were virtually zero.
In developing its downstream industry, its newest project is Abu Dhabi Melamine Industry. The project cost is estimated at $200 million of which Adnoc holds a 60 per cent and Austrian Agrolinz Melamine International, the remaining 40 per cent.
The new company, which is expected to be operational in the first quarter of 2009, will be the third petrochemical company after Fertil and Borouge, both of which are partly owned by Adnoc.
It will produce 80,000 tonnes per annum of melamine.
In terms of diversification, Adnoc has stated that its main target market is South East Asia, particularly China.
To meet its expansion plans Adnoc is also seeking about DH16 billion in syndicated financing from banks. Borouge for example is finalising finance for its $2.5 billion expansion.
three Abu Dhabi- based banks are said to have confirmed they
have bid to become Mandated Lead Arrangers (MLAs) as well as
some foreign banks. The short list is expected to be
finalized next month after which it will go to general