Adnoc takes a leap forward in becoming a chemicals giant
21 May 2025
Commentary
Indrajit Sen
Oil & gas editor
Abu Dhabi National Oil Company (Adnoc) has made a significant stride forward in its quest to build a burgeoning chemicals business following the European Union’s (EU) approval for the full acquisition of German chemicals producer Covestro.
Adnoc International, the overseas business arm of Adnoc Group, signed an investment agreement with Covestro on 1 October, in which it made a takeover offer of €14.7bn ($16.3bn).
On 13 May, the European Commission, the executive wing of the EU, gave unconditional antitrust approval for the acquisition, saying that the transaction does not raise competition concerns. It added that the companies mainly operate at different levels of the chemical and petrochemical supply chain and would not be able to restrict rivals’ access to inputs or customers.
Having secured the green light for the Covestro takeover, Adnoc will now look to complete the transaction swiftly. In parallel, the Abu Dhabi energy giant is also likely to move quickly to conclude its deal with Austria’s OMV for a proposed combination of their shareholdings in Abu Dhabi’s Borouge and Austria-based chemicals producer Borealis.
Adnoc and OMV agreed in March to the terms of a binding framework agreement for the merger of Borouge and Borealis. That, together with the contribution of the upcoming Borouge 4 petrochemicals project in Abu Dhabi, will create a major polyolefins producer valued at over $60bn that will be the world’s fourth-largest by nameplate production capacity.
Separately, Adnoc also entered into a share purchase agreement in March with Canada-based Nova Chemicals Holdings, an indirectly wholly-owned company of Abu Dhabi’s sovereign wealth institution Mubadala Investment Company, for 100% of Nova Chemicals Corporation (Nova).
With the takeover of Covestro likely to conclude in the next few months and the Borouge-Borealis merger, along with the acquisition of Nova, expected to be completed in the first quarter of 2026, Adnoc is set to morph into a behemoth in the global chemicals industry in less than a year.
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The request for qualifications (RFQs) was issued by the municipality’s Sewerage and Recycled Water Projects Department (SRPD).
The bid submission deadline is 26 February.
The first scheme under the package is TF-16-C1, which involves upgrading and rehabilitating the stormwater system east of the Dubai Canal.
The second, TF-15-C2, will deliver stormwater links along Umm Suqeim Road to serve the Al-Barsha and Al-Quoz communities.
The third project, TF-13-C1, focuses on developing a drainage system for the Al-Marmum area.
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In January, local firm DeTech Contracting won the main contract to construct a stormwater drainage system in Jebel Ali.
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Modon tenders Ras El-Hekma construction contracts
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Abu Dhabi-based developer Modon Holding has tendered several contracts as part of the first phase of development at Ras El-Hekma, a planned new city on Egypt’s Mediterranean coast.
MEED understands that the tenders were issued in January.
These include:
DP3 assets: covering 146 residential villas, 590 three-bedroom townhouses, 356 four-bedroom townhouses, a mall and other associated works.
Bids due on 23 February.
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In September, MEED reported that Modon Holding had tendered contracts for the infrastructure works for the first phase of the Ras El-Hekma project.
As part of the first phase, Modon plans to develop more than 50 million square metres (sq m), including hotels and a marina.
Ras El-Hekma is on a spur of land on Egypt’s northern Mediterranean coastline, about 240 kilometres west of Alexandria.
Last year, Abu Dhabi-based holding company ADQ appointed Modon Holding as the master developer for the Ras El-Hekma project.
According to an official statement, Modon will act as the master developer for the entire development, which will cover more than 170 million sq m.
Modon Holding will develop the first phase of the project, which will cover 50 million sq m.
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Chinese firm wins Ceer automotive supplier park deal
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