Adnoc Group's distribution and marketing component will set up a lubes and grease plant as well as storage warehouses to support product distribution operations in different emirates. The company will commence operations in the new location by the beginning of 2022.
The initial production capacity of the lubes and grease plant will reach 100,000 tonnes per year, with the possibility to reach up to 200,000 tonnes per year in the future. The main products to come from the plant will include vehicle lubricants, marine lubricants, industrial lubricants, greases and various specialty fluids.
Adnoc Distribution signed a musataha agreement which will allow acquisition of land to set up new facilities at Kizad and provide logistical support to its existing developments.
The agreement was signed by Saeed Mubarak Al Rashidi, acting chief executive officer of Adnoc Distribution, and Mana Mohammed Saeed Al Mulla, chief executive officer of Kizad, at Adnoc Distribution's headquarters in Abu Dhabi.
The storage warehouses will increase Adnoc Distribution's ability to supply Abu Dhabi with different fuel products such as diesel, E Plus-91 and Special 95. It will also supply Abu Dhabi International Airport and Al Maktoum International Airport with Jet-A1 fuel as well as gas oil to Al Taweelah Power and Desalination Complex via pipelines.
The new warehouse at Kizad will provide a storage capacity of 545,000 cubic metres, in which 75,000 cubic metres will be dedicated to storage of fuel such as E Plus-91. 105,000 cubic metres will store the Special 95, 180,000 cubic metres will be for diesel and 180,000 cubic metres will be for Jet A1 fuel. This is expected to serve as a back-up in case of any disruption of operations at the existing Mussafah terminal.
Through this agreement, Adnoc Distribution will allocate three logistical shipping lanes in which the first is linked to Khalifa Port, the second parallels the main logistical lane in Kizad while the third lane has been allocated towards going outside the industrial zone. Terms of the agreement also included the allocation of a jetty at Khalifa Port to receive shipments of petroleum products from the Ruwais refinery.
Kizad, which is spread across 418 square km, is located in Taweelah, between Abu Dhabi and Dubai and next to Khalifa Port.
Al Rashidi said: "Within Adnoc Distribution's future strategic plan, we have clear direction for expansion, both geographically and qualitatively in terms of the products, services and facilities we provide."