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ADNOC Distribution Signs a Fifty-year Mustaha Agreement with Abu Dhabi Ports

16 May 2016 - Operations will commence in the new location by the beginning of 2022

In line with Abu Dhabi Vision 2030, which is aimed at creating an effective shift in the Emirate’s economy and to achieve greater integration with the global economy; ADNOC Distribution and Abu Dhabi Ports  signed a Mustaha agreement yesterday. The new agreement aims to strengthen ADNOC Distribution’s capacity to develop new projects at Khalifa Industrial Zone (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 signing of the agreement was witnessed by a number of officials and senior members of both parties.

The agreement will strengthen ADNOC Distribution’s efforts to meet the great demand for its services and products while meeting the requirements of Abu Dhabi Vision 2030. ADNOC Distribution will begin to implement a plan to set up a lubes and grease plant, as well as strategic storage warehouses to support product distribution operations in different emirates. The company will commence its 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 production up to 200,000 tonnes per year in the future. The main products output from the plant include Vehicle Lubricants, Marine Lubricants, Industrial Lubricants, Greases and various Specialty Fluids.

The storage warehouses will increase ADNOC Distribution’s ability to supply Abu Dhabi with different fuel products such as diesel, E Plus-91, Special 95 using cargo trucks. 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.

Commenting on the agreement, Eng. Saeed Mubarak Al Rashidi, Acting Chief Executive Officer of ADNOC Distribution 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. As part of our objective to achieve the best results, we are keen to enter strategic partnerships and implement a range of specialised and targeted studies to search for opportunities that will support our need to meet the growing demand for our products and services. 

Al Rashidi added: “Due to our belief in the importance of Abu Dhabi’s national economic agenda and in promoting partnership
initiatives between different economic and investment bodies, we look at this agreement with Abu Dhabi Ports as a way to achieve the highest levels of economic value for both parties. This will be done through moving some of our operational facilities to the new site and establishing new expansive platforms, by taking advantage of the high level infrastructures of Kizad, which can support hosted industrial and investment projects of various sectors in the region and globally.”

Commenting on the agreement, Captain Mohamed Juma Al Shamisi, CEO of Abu Dhabi Ports said: “ADNOC Distribution’s decision to be present at Kizad is a substantial and supportive move to Abu Dhabi’s economic growth and a vital addition to our strategic partners. We are confident that the strategic geographical location near Khalifa Port and what Kizad has to offer, in terms of logistical services and world-class infrastructure, will support ADNOC Distribution’s ability to meet the huge demand for petroleum products, which is one of the most prominent elements of economic and industrial projects.”

According to the plans approved by ADNOC Distribution, the storage capacity to be provided by the new storage warehouse at Kizad will amount to 545,000 cubic meters, in which 75,000 cubic meters will be dedicated to storage of fuel such as E Plus-91. 105,000 cubic meters will store the Special 95, 180,000 cubic meters will be for diesel fuel, and 180,000 cubic meters will be for fuel for Jet A1 fuel. This repository is expected to serve as a full 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 of 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.

ADNOC Distribution is a company owned by Abu Dhabi government specialised in the marketing and distribution of petroleum products in the United Arab Emirates where it operates a vast network of service stations and convenience stores that play a vital role in the Emirate’s economy and its social development programmes. The company is equipped with the most advanced technology for fuel, automated car wash and vacuuming, lube bay and tire repair as well as commercial products and services that cater to different industries such as construction and industrial.

Kizad, which spreads over an area of 418 sq. km, is located in Taweelah, between Abu Dhabi and Dubai and next to Khalifa Port. By offering trade, logistics and industrial solutions, Kizad supports economic diversification as mandated by Abu Dhabi’s 2030 Economic Vision. Abu Dhabi Ports actively contributes to the total non-oil GDP in Abu Dhabi. 

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