By: AGBI

Adnoc and the Abu Dhabi National Energy Company (Taqa) have agreed jointly to build the Ta’ziz chemical and transition-fuel project in Ruwais, west of Abu Dhabi, to accelerate the UAE’s industrial diversification.

The two companies will develop the central utilities project, including electricity grid connection, steam production, process cooling and a range of water and wastewater utilities required for large-scale chemicals manufacturing.

The utilities project is being developed on a build-own-operate basis by a company jointly owned by Taqa (60 percent) and Adnoc (40 percent), Taqa said in a statement published on the Abu Dhabi Securities Exchange.

The companies have signed a 27-year utilities purchase agreement. No financial details were given.

Ta’ziz, a joint venture between the state-backed Abu Dhabi National Oil Company (Adnoc) and sovereign wealth fund ADQ, plans to set up and own a service management company that will be the sole offtaker of the utilities.

Ta’ziz will produce 4.7 million tonnes per annum of chemicals from 2028. This will include methanol, low-carbon ammonia, polyvinyl chloride, ethylene dichloride, vinyl chloride monomer and caustic soda.

“Through this long-term partnership with Adnoc, we are supporting the diversification of Abu Dhabi’s economy and investing in strategic and sustainable infrastructure that will contribute to GDP growth,” Ta’ziz CEO Mashal Al-Kindi said.

Farid Al Awlaqi, CEO of Taqa’s generation business, said the agreement strengthens its role in enabling industrial growth by providing reliable and efficient utility infrastructure to support chemical and transition-fuel production. 

Taqa’s generation business is expanding its regional portfolio, which includes the 1-gigawatt Al Dhafra gas turbine project in the UAE and 3.6GW power plants – Rumah 2 IPP and Al Nairyah 2 IPP – in Saudi Arabia, being developed alongside Japan’s Jera and Saudi Arabia’s AlBawani Capital.

In May last year, Sultan Al Jaber, federal minister of industry and advanced technology, said the UAE planned to invest more than AED40 billion ($11 billion) over the next five years to establish itself as a centre for advanced manufacturing.

The investment target is part of a 10-year industrial strategy launched in 2021 aimed at raising the sector’s GDP contribution to AED300 billion by 2031.