Borouge has awarded two major contracts, which will boost the nameplate capacity of its second ethane cracker (EU2) and the fourth and fifth polyethylene units (PE4 and PE5). The asset expansion is expected to contribute between US$165 million and US$200 million in EBITDA annually.
Linde Engineering has been awarded a contract for Front-End Engineering Design (FEED) services to upgrade EU2 with an additional capacity of 230,000 tonnes per annum (tpa).
Borouge awards key contracts
The company has also awarded Target Engineering Construction Company an engineering, procurement, and construction (EPC) contract for the expansion and refurbishment of its PE4 and PE5 production units, following a competitive bidding process.
Following the completion of the project in Q4 2028, the EU2 cracker’s capacity will increase by 15 per cent, delivering significant financial gains. Linde was selected for its expertise in design and execution, as well as its role as the licensor of the existing EU2 cracker.
PE4 and PE5 production units enhancement will increase their nameplate capacity from 540,000 to 700,000 tpa each. The project is scheduled to be ready for start-up in the first quarter of 2027.
Hazeem Sultan Al Suwaidi, CEO of Borouge, commented: “By increasing production at our EU2, PE4 and PE5 units, as well as delivering the Borouge 4 mega project, we are strategically positioned for accelerated growth.
“The expansions of our ethylene and polyethylene capabilities will enable Borouge to meet growing market demands, unlock new revenue streams, and further strengthen our global market position.”
Since 2001, the company has increased its annual production capacity tenfold, reaching 5 million tpa and positioning itself among the top five polyolefin producers in the Middle East and Asia Pacific. Together, with the Borouge 4 mega project, these expansion projects will increase the company’s annual total polyolefins production capacity to over 6.6 million tpa by 2028.
The company’s major shareholders, ADNOC and OMV have proposed the combination of Borouge and Borealis, along with the acquisition of Nova Chemicals, to create Borouge Group International. These will create the world’s fourth largest polyolefin company, valued at US$60 billion with a capacity of 13.6 million metric tonnes across 62 plants spanning North America, Europe and the Middle East.
