Takreer wants to be recognized as a trendsetter in creating sustainable value growth through innovative energy solutions. How are you bringing your energy solutions to market?
Takreer aims to be the best in the refining industry and capitalize on the opportunities we have here in Abu Dhabi. Our opportunities lie in our large industrial base upstream. We have a good supply and there are other downstream industries we can integrate with by providing the necessary feedstock or other additives. We not only want to be a provider of transportation fuel, but also to maximize the benefits to the country by integrating with local industries and diversifying our production.
How do the fuels that you produce—naphtha, kerosene, gasoline, and diesel—reflect the market needs here?
We have typically produced transportation fuels and other products that we export. However, we are trying to move away from our typical production and maximize the benefit of each barrel. With the new expansion and our heavy oil conversion project called the carbon black and delayed coker project (CBDC), we will move toward diversifying our production. In Abu Dhabi, there are growing numbers of environmental regulations and all transportation fuels have to meet Euro 5 specifications. We managed to achieve that and were in fact ready earlier than required with the completion of our Green Diesel Project in 2012. With our CBDC project, we will also be able to convert heavy oil into more valuable products. This is again part of our diversification process and the provision of feedstock to local industries around us.
How does Takreer's largest site, the Ruwais Refinery, connect to large projects and other companies in terms of integration and facilitating business?
We recognize that this industry is a margin-driven industry. Refineries are under pressure, as their margins are not nearly as good as those in the upstream businesses. There are three main factors that will enable us to boost our margins and make us more economically robust. One factor is scale, as this allows us to distribute our costs more effectively in terms of dollars per barrel. Complexity is another important factor. You need to have deep conversion of the crude oil to extract lighter and more viable products. The third factor is integration. If your refinery has a nearby petrochemical industry, this will save capital expenditure and operating costs for both industries. Of course, you also need to expand to cover the local market's requirements in terms of transportation fuels and petrochemical feedstock. When we were looking at our expansion we had these three elements in mind to ensure that we would in fact be in a stronger economic position afterwards. With the new refinery, we managed to achieve all these elements. In terms of scale, we have doubled our capacity by moving from 500,000bpd to more than 900,000bpd. The Nelson Complexity Index (NCI) measures refinery complexity, and after our expansion we will reach a complexity factor of more than 14, which covers highly complex facilities. The higher you are on the scale the better your margins are.
How does this relate to the wider economy and the mandate to make Abu Dhabi self-sufficient in gasoline?
Importing refined products is not particularly wise, especially when you produce crude oil. It does not make sense to import a product when you can make it here with your own facilities and people and add to GDP. This new refinery will be self-sufficient in gasoline. We do not import jet fuel or diesel as we were already self sufficient in these products. With the new refinery our exports will increase. When you build a new refinery you do it with the next 30 years in mind, not for the short term. Exports will shrink with growth, which is normal. However, with the gasoline we have only designed the operations for the local market; we are not thinking of exporting gasoline.