ChemChina (Beijing) and oil company Rosneft (Moscow, Russia) have signed a non-binding agreement setting out the framework for implementation of the companies’ previously announced Far-Eastern Petrochemical Co. (FEPCO) project, located near the city of Nakhodka in far eastern Russia.
The agreement was signed by ChemChina president Ren Jianxin and Rosneft CEO Igor Sechin on 4 September during the G20 summit in Hangzhou, China. It confirms the intention of each party to develop FEPCO and create a joint venture (JV) for its implementation. Rosneft will hold a 60% stake in the JV and ChemChina will hold the remaining 40%. It also specifies the schedule of performing the front-end engineering and design, infrastructure development, and the key tasks of implementing the project.
“The creation of the JV will allow us to efficiently build the development structure of one of the most promising petrochemical projects of the world that has direct access to the market of the Asia/Pacific region,” Sechin was quoted by Russian media as saying.
ChemChina and Rosneft signed a memorandum of understanding for the FEPCO project in September 2015. In June 2016, the parties signed a heads of agreement for a joint feasibility study.
The FEPCO project would be one of the largest industrial complexes in Russia. Phase 1 of the project, scheduled for completion in 2020, comprises a 12-million metric tons/year refinery. Phase 2, to be completed in 2022, will have a petrochemical plant that includes a naphtha cracker capable of producing 1.4 million metric tons/year of ethylene and 600,000 metric tons/year of propylene, according to Rosneft. Downstream production will include 850,000 metric tons/year of polyethylene; 800,000 metric tons/year of polypropylene; 200,000 metric tons/year of butadiene; 230,000 metric tons/year of benzene; and 700,000 metric tons/year of ethylene glycol.
By Sok Peng Chua
Source: Chemical Week
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