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Samsung E&A wins $1.7bn Abu Dhabi methanol project

3 February 2025

Abu Dhabi’s Taziz has awarded South Korean contractor Samsung E&A the main engineering, procurement and construction (EPC) contract to build the UAE’s first methanol plant in the Taziz Industrial Chemicals Zone in Ruwais Industrial City.

The nameplate production capacity of the planned methanol complex is 5,000 metric tonnes a day, or 1.8 million metric tonnes a year (t/y).

Switzerland-based energy and chemicals company Proman is a joint investor in the methanol project.

The value of the EPC contract won by Samsung E&A is $1.7bn, with the duration of works being 44 months.

“Upon completion in 2028, it will be powered by clean energy from the grid, making it one of the world’s most energy-efficient methanol plants,” Taziz said in a statement on 3 February.

MEED had in November reported about Samsung E&A emerging as the frontrunner to win the main EPC contract for the project.

The only other bidder for the project is a consortium of French contractor Technip Energies and India-based Larsen & Toubro Energy Hydrocarbon.

The two entities submitted technical bids for the project by the deadline of 22 July, and commercial bids by the deadline of 16 September.

Methanol is a critical chemical building block with industrial applications in fuels, adhesives, solvents, pharmaceuticals and construction materials. Emerging economies in Africa and Asia are expected to drive growth in methanol demand, while methanol production in the UAE will reduce reliance on imports.

Proman signed a shareholder agreement with Taziz for the planned methanol project in January 2023. The two companies initially announced the project in March 2022.

Technip Energies has performed the front-end engineering and design (feed) work on the methanol project, having won the contract in September 2022.

The Proman/Taziz joint venture (JV) had issued the expressions of interest document to contractors for the methanol project’s EPC tendering exercise in August 2023. Contractors submitted prequalification documents by 21 August.

Proman and Taziz issued the main tender for EPC works on the planned methanol project on 17 January, last year. The JV initially set a deadline of 17 April for the submission of technical bids, which was then extended to 17 June, and later to 22 July.

Taziz chemical investments

Taziz, a 60:40 JV of Abu Dhabi National Oil Company (Adnoc Group) and Abu Dhabi’s industrial holding entity ADQ, has attracted investments from several foreign investors for its chemicals projects in the under-construction petrochemical derivatives complex in Ruwais.

Adnoc first announced in May 2021 that it would proceed with developing a “world-scale” blue ammonia production facility in Abu Dhabi’s industrial hub of Ruwais.

UAE-based Fertiglobe, South Korea’s GS Energy Corporation and Japanese investment firm Mitsui & Company eventually formed a JV to develop the blue ammonia facility, which will have an output capacity of 1 million t/y.

The JV later awarded Italian contractor Tecnimont the EPC contract for the project, and construction on the facility started in June.

In June 2021, Fertiglobe signed an agreement with Taziz to become the project’s lead developer. In January 2023, Fertiglobe signed a shareholder agreement with GS Energy and Mitsui to develop the planned blue ammonia facility.

In addition to the blue ammonia and methanol projects, MEED previously reported that feed contracts had been awarded for Project Salt, a planned cluster of three chemicals plants that will produce ethylene dichloride, chlor-alkali and polyvinyl chloride.

In December 2021, Taziz secured agreements from eight UAE-based entities for investments in its planned chemicals projects in Ruwais. The agreements marked the first domestic public-private partnership in Abu Dhabi’s downstream oil, gas and petrochemicals sector.

Regarding infrastructure to support units in the chemicals production zone, Taziz awarded three EPC contracts totalling $2bn, in November, for infrastructure works at the industrial chemicals zone in Ruwais.

Abu Dhabi government-owned NMDC Group was awarded the EPC contract to build a chemicals port. Once complete, the port will facilitate the export of chemicals and fuels.

Singapore-based Rotary Engineering won the EPC contract for a chemicals terminal, known as Project Landing. The contract includes developing storage facilities, tank-to-jetty pipelines, jetty-to-tank pipelines, inter-site pipelines and liquid product storage. Taziz is building the chemicals handling terminal in partnership with Netherlands-based midstream energy company Advario.

Abu Dhabi-based Al-Geemi Contracting was awarded the EPC contract to develop essential infrastructure for the 17-square-kilometre Taziz chemicals production site, including internal roads, security fencing and buildings.

Taziz also said it was close to awarding the EPC contract to develop a centralised utilities facility for the chemical zone, including power transmission, steam, cooling water and water units. Adnoc has signed an agreement with Abu Dhabi National Energy Company (Taqa) to develop the cogeneration power facility in Ruwais.

ALSO READ: Local firms invest in Taziz industrial complex

Taziz has planned seven petrochemicals derivatives projects as part of the first phase of its industrial chemicals zone.

UK-headquartered Wood Group has performed the feed works on the seven projects, which are:

Anchor product

End use

Chlor-alkali

Water treatment, metallurgy and textiles

Ethylene dichloride

Housing, infrastructure and consumer goods

Maleic anhydride

Piping, construction and heavy transport

Methanol

Energy, consumer goods and pharmaceuticals

Blue ammonia

Agriculture, apparel and energy

Isopropyl alcohol

Healthcare and cosmetics

Elastomers

Automobiles, adhesives, food production and storage

Chemicals production is a priority sector for Operation 300bn, the UAE’s industrial growth strategy.

The industrial strategy is being overseen by the Industry & Advanced Technology Ministry, which aims to raise the UAE industrial sector’s contribution to the national GDP to AED300bn ($81.7bn) by 2031.

ALSO READ: Fertiglobe begins next growth chapter in Abu Dhabi
https://image.digitalinsightresearch.in/uploads/NewsArticle/13356606/main4151.jpg
Indrajit Sen

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