By: Musabbeh Al Kaabi, Chief Executive Officer, Petroleum & Petrochemicals, Mubadala Investment Company
Over the recent years, the United Arab Emirates has been working diligently to establish itself as a pioneering nation in the world’s energy landscape.
The UAE Energy Strategy 2050, aims to create a balance in the country’s energy mix achieving a 50/50 contribution between traditional and other energy resources including renewable, nuclear and solar energy. This strategic plan is testament to the efforts exerted towards placing the UAE as a future global energy leader, a role successfully played over the past 60 years.
For over 30 years, Abu Dhabi has hosted ADIPEC, one of the world’s largest oil and gas events attracting global energy players including governments and policy makers, as well as industry peers such as IOCs and NOCs from all over the world reinforcing the UAE’s position as an influential energy hub for the region, and the world.
This year we are celebrating the Year of Zayed, commemorating the legacy of the late Founding Father of the UAE, Sheikh Zayed Bin Sultan Al Nahyan. Sheikh Zayed was a visionary leader, who recognised that being blessed with significant oil resources presented the nation with an opportunity to utilise the returns from hydrocarbons to build a diversified economy and secure a long-term prosperous future for the people of the UAE.
From this vision, our company Mubadala Investment Company was born. Mubadala is a result of the merger between the International Petroleum Investment Company (IPIC) and Mubadala Development Company, finalised in May 2017.
Over a year on from the merger, we are proud of the synergies achieved and the smooth integration of both companies, the combined business portfolio and our people. As a global investment company, we are committed to delivering sustainable financial returns supporting our shareholder’s strategic objective of a diversifying the economy.
As reflected by our latest financial results and operational highlights, Mubadala currently manages a global investment portfolio worth more than US$ 225 billion. As CEO of the Petroleum & Petrochemicals platform, my role is to oversee the active portfolio management of our robust and diversified global portfolio of a number of oil and gas companies valued at over US$40 billion spanning the hydrocarbon value chain.
Delivering on its strategy, the platform achieved a number of major milestones in 2018;
Mubadala Petroleum completed the acquisition of a 10 per cent stake in the Shorouk Concession in Egypt, encompassing the Zohr gas field – the largest natural gas field ever discovered in the Mediterranean. Elsewhere, with partners Russian Direct Investment Fund (RDIF) and Gazprom Neft, Mubadala Petroleum completed the transaction and creation of a joint venture, to develop oil fields in Western Siberia. These projects mark Mubadala Petroleum’s first venture in both markets.
Within Refining and Petrochemicals:
Borealis and NOVA Chemicals, announced the start of operations as part of a joint venture with Total, called Bayport Polymers LLC (“Bay-Pol”), at a new US$ 1.7 billion ethane steam cracker plant in Port Arthur, Texas. The joint venture exemplifies Mubadala’s commitment to the North America market where highly competitive feedstock driven by the unconventional resources is available. These achievements and many others within our integrated portfolio are evidently built on partnerships, one of Mubadala’s core values. We take pride in our long-standing relationships, such as our collaboration with ADNOC, the hosts of ADIPEC. Together we are working to advance one of the world’s largest petrochemical hubs in Ruwais, Abu Dhabi. Through an agreement ratified this year with Mubadala’s portfolio company, CEPSA, we plan to build a new linear alkylbenzene (LAB) facility, to produce industrial detergent compounds and ultimately provide the right ecosystem to attract LAB customers to build industrial facilities in Abu Dhabi.
CEPSA is the world’s leader in LAB production and signed the initial MoU agreement with ADNOC at ADIPEC last year. More recently, ADNOC selected CEPSA and OMV as partners in its offshore concessions Umm Lulu and SARB with a 20 per cent stake worth US$ 1.5 billion demonstrating the companies’ abilities to deliver based on their expertise and track record, as strong and capable players in the industry.
In the downstream sector, Borealis and ADNOC have entered a JV partnership to further expand Abu Dhabi’s petrochemicals capabilities by building a new polypropylene-5 (PP5) plant equipped with Borealis’ proprietary Borstar technology to produce up to 600,000 tons of polypropylene products per year.
As a global investor, we intend to continue to expand our portfolio overseas through active portfolio management by seeking suitable growth opportunities in emerging markets. Yet, we are also entrusted by our shareholders to continue building upon Abu Dhabi’s rich legacy in oil and gas. This ambition will be realised by bringing proprietary technology, human capital, operational experience and market knowledge to the Emirate, through the international partnerships established across our diversified portfolio. I look forward to the final months of the year as we continue delivering on our strategy, by creating value for our business, and maintaining steady momentum as we look ahead to 2019.