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The Abu Dhabi Polymers Company's (Borouge) expansion to triple production will meet rising demand in Asia and the Middle East and possibly Europe, the company's chief said. He said that despite the cyclical nature of the petrochemical industry and demand volatility, Borouge's technology and value-added products would ensure growth in sales.
"Demand for polyethylene and polypropylene is growing at a healthy rate of 6 to 8 per cent. Although the petrochemical industry in the Middle East is expanding very fast and there could be over-supply, in our view there will be demand especially from Asia," said Harri Bucht, Chief Executive of Borouge. "The industry is still very much cyclical but through our strategy of selling value-added products through our Borstar technology (the only kind in the region) we are better able to smoothen the cyclical ups and downs," he told Gulf News in an interview. Last month Borouge announced it would invest over $2.5 billion to triple production at its complex in Abu Dhabi. Borouge is owned 60 per cent by Adnoc and 40 per cent by Denmark's Borealis. Bucht ruled out the possibility of entering the US market, saying the focus would be on the core Asian and Middle East markets and perhaps Europe. "We don't see the US as a potential market because it is very far but we will monitor the European situation. However, our investments are made for the Middle East and Asia, clearly the target markets. The economies are growing faster in these markets, impacting demand for our products," he said. Current production capacity is 600,000 tonnes per annum but the major phase three expansion will lift capacity to 2 million tonnes of enhanced polyolefins (polyethylene and polypropylene) per annum by 2010. Most of the current production is exported with Asia accounting for the lion's share and the Middle East taking some 20 to 25 per cent of exports. "Geographically, in terms of new markets, we do not have any but we are actively identifying new applications of our Borstar material that can be better utilised by our customers. So we are into product development work with our customers," said Bucht.
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