The Abu Dhabi National Oil Company (ADNOC) has announced a new strategic partnership with OCI, a producer and distributor of natural gas-based fertilisers and industrial chemicals, headquartered in the Netherlands
The partnership will see ADNOC combine its fertiliser business, ADNOC Fertilizers, into OCI’s Middle East and North Africa (MENA) nitrogen fertiliser platform to form a new joint venture (JV).
The joint venture will create the largest export-focused nitrogen fertiliser and the largest producer in the MENA region with a production capacity of five million tonnes of urea and 1.5 million tonne of sellable ammonia.
The annual revenues for the combined entity will be US$1.74bn, based on 2018 pro forma figures with ADNOC and OCI owning a 42 per cent and 58 per cent stakes in the joint venture respectively.
Sultan Ahmed Al Jaber, UAE minister of State and ADNOC Group CEO, said, “This unique business combination is in line with ADNOC’s approach to value-added partnerships and will improve the profitability and cash flow of our fertiliser portfolio.”
“It also supports ADNOC’s objectives to attract investors to Ruwais by leveraging its strategic location, world-class logistics and the UAE’s abundant gas resources at commercially attractive terms. It is another milestone in the delivery of ADNOC’s 2030 strategy and our ambitions to expand ADNOC’s Downstream portfolio,” he added.
Nassef Sawiris, CEO of OCI, commented, “I am very pleased to start a long-term strategic partnership with ADNOC, a company which has a clear downstream strategy and drive to unlock value. This partnership creates a first-of-its-kind export platform with best-in-class cash conversion metrics. I believe that this platform has significant potential for future growth and value creation, with the support and under the guidance of its two key shareholders.”
