Khalifa Al Suwaidi, Executive Director, Refining & Petrochemicals, Petroleum & Petrochemicals at Mubadala Investment Company on current projects and industry disruptors
Mubadala has had an active year - what has been fundamental to the company’s operations and performance?
Following the formulisation of Mubadala Investment Company, our business has continued to evolve and diversify over the last 18 months. Today, Mubadala is a global investment company with a portfolio valued at more than $226 billion encompassing assets and companies operating across ﬁve continents.
This strategic shift is reﬂected within the Petroleum & Petrochemicals business unit, headed by platform CEO Musabbeh Al Kaabi. We manage an extensive integrated portfolio of investments across the oil and gas value chain, which today is valued at more than $41 billion and one that represents a world-class group of companies operating across the value chain.
Mubadala has strong representation within petrochemicals – why is this an important sector for your business?
In my role leading Mubadala’s Reﬁning & Petrochemicals sector, it has been very rewarding to see this area of our business ﬂourish. Success has come by focusing on three main pillars; building on the synergies between our portfolio companies, taking advantage of competitive feedstocks and growing markets, as well as partnering with other leading downstream players.
Today’s operating climate requires companies in the sector to respond to the global demand for more complex and higher quality petrochemicals products and our asset companies are working closely with their customers to supply the products vital to many of the technology focused products.
An example of our approach is the joint venture formed to develop our presence in the US Gulf Coast petrochemicals hub. Two of our portfolio companies within the sector, Borealis and NOVA Chemicals, are collaborating with their technology and market and operating experience in Bayport Polymers LLC (“Bay-Pol”) – a newly approved joint venture with Total. This project will take advantage of low feedstock prices in the
U.S and combines Total’s existing Bayport, Texas, polyethylene 400 kt/y facility, a new 625 kt/y polyethylene unit at the Bayport site utilising Borealis proprietary Borstar® technology Borstar® technology, as well as the development of a new ethane steam cracker in Port Arthur, Texas.
Beyond North America, Pak-Arab Reﬁnery Ltd (PARCO) - a joint venture between the Government of Pakistan, Mubadala Investment Company – is developing plans to build a new facility to increase Pakistan’s reﬁning capacity by 150 per cent. Currently subject to engineering and other studies, the reﬁnery will maximise Abu Dhabi crude by taking in feedstock from Mubadala’s strategic partner ADNOC as well as supplies from Saudi Aramco in Saudi Arabia. Long-term, the reﬁnery is set to become Pakistan’s most technologically-advanced, with production capacity designed to meet the rapidly growing demand for reﬁned products.
At a domestic level, Cepsa is advancing Ruwais Downstream Complex through collaboration ADNOC. Cepsa is a linear alkyl benzene (LAB) market leader, and will sign a development agreement to build the world-largest and most-efﬁcient LAB manufacturing facility in Ruwais.
What is your view on current industry disruptors?
Firstly, we have actively been monitoring the growth of electric vehicles, however our view is that these types of vehicles will start from a very low base but with the potential to grow rapidly. Even from a low threshold, the opportunity for the petrochemicals industry is clear. These types of vehicles are designed heavily utilising lightweight materials, which require specialty and complex components derived from petrochemicals. This is just one prime example of the vital contribution petrochemicals is making to the development and manufacture of new and innovative technology products.
Secondly, whilst there is an increasing demand for plastics due to population growth and higher standard of living globally, we realise the impact poor plastic disposal can have on our environment. As a responsible investor, Mubadala shares a common concern about plastic waste and subsequent environmental issues and our portfolio companies are all working to address this issue.
Borealis, has been a pioneer in responding to this challenge. The company, along with other investee companies, NOVA Chemicals and Borouge, are involved in the STOP Ocean Plastics project, a frontline initiative to prevent ocean plastic leakage in South-East Asia, most recently initiating two additional city partnerships in Indonesia. Last month, Borealis was also involved in signing the New Plastics Economy’s ‘A Line in the Sand’ – a new global commitment signed by plastic related companies. As part of the agreement, Borealis will be committing to increase its recycled plastics volume by fourfold by 2025.