The Abu Dhabi National Oil Company (Adnoc) signed on Monday a joint venture agreement with Agrolinz Melamine International (AMI) to build a $200 million melamine plant at Ruwais near Abu Dhabi. The agreement calls for a 60:40 equity split between Adnoc and AMI in the new company, Melamine International.
The new company is Adnoc's third venture in the petrochemical industry. Adnoc established Ruwais Fertilizer Industries (FERTIL) in 1980 as a fertilizer plant company and Abu Dhabi Polymers Company Ltd. (Borouge) in 1998 as a polyethylene plant company.
The new venture is part of a diversification strategy by Adnoc. One of the main components of melamine resin is urea, which can be readily supplied by Adnoc's FERTIL plants. In addition to Adnoc's chemical infrastructure, AMI will provide technology and marketing know-how to support the new venture.
Joachim Grill, CEO of AMI, expressed hope for business prospects in Abu Dhabi. After signing the agreement with Adnoc, Grill said, This joint venture is the first step towards closer cooperation with Abu Dhabi and we look forward to further joint ventures here.
Omair Bin Yousef, CEO of Adnoc, was also hopeful for the new venture: The global market for melamine is growing rapidly with demand rising at 7 to 8 per cent in Asia alone every year. Considering such a growth rate, we plan to grow with the market and later expand.
Production of melamine is scheduled to start in the first quarter of 2009. The plant will produce 80,000 tonnes of melamine annually.