Construction of gas chemical plant in Eastern Siberia Construction and Real Estate

"Sibur" offered to participate in the construction of a plant for the production of polyethylene

The Irkutsk Oil Company offered Leonid Michelson Sibur to participate in the construction of a gas chemical plant in Eastern Siberia. The total budget of the project is estimated by the company at 456 billion rubles.

Sibur may become a partner of the INC

The Irkutsk Oil Company (INC), controlled by Nikolay Buinov, offered Sibur to become a partner in a major gas-chemical project in Eastern Siberia. About this RBC told three sources familiar with the top managers of both companies.

A project worth 456 billion rubles. consists of three stages and involves the construction of a plant for the production of polyethylene with a capacity of 650 thousand tons per year (used for the production of films, cables, plastics, etc.). INK offered Sibur a minority stake in the company, a maximum of 25%, said one of the interlocutors of RBC. The company is negotiating to attract other minority shareholders, but will retain more than 50%, he adds.

“The advantages of Sibur are in the competence to implement investment projects of such a profile, logistics and operation of product flows, sales of polymer products on the Russian and international markets,” says one RBC spokesman. Companies can conclude an off-take contract: Sibur will buy polyethylene from the plant and sell it through its own channels, a second source adds.

The INC is exploring various opportunities to attract partners, this stage is not completed, a representative of the Irkutsk Oil Company told RBC. “Sibur is focused on the implementation of the key project Zapsibneftekhim, as well as the development of the Amur GCC, to make the final decision on the implementation of the project in the previously announced deadlines in the second half of 2019,” said a Sibur representative. The company is considering various possibilities for developing the project portfolio and applying the skills of the project management of NIPIGAZ (part of Sibur), he added. According to the representative, Sibur knows about the INC project, but “there are no agreements in any detail today.”

The project is 456 billion rubles.

The Irkutsk Oil Company has been implementing a gas project since 2014 on the basis of the Yarakta field in the north of the Irkutsk region. The company cannot supply gas to Russian consumers - the market is too far, there is no infrastructure. It is also impossible to export raw materials through the Power of Siberia being built while it is under construction, only Gazprom has the right to export natural gas from Russia. “The philosophy of the project is to process gas here, on-site, in the Irkutsk region,” Nikolai Buynov, the largest co-owner of the Irkutsk Oil Company, explained in an interview with Vedomosti in 2015.

The INC has already invested RUB 44 billion in the project. and built the first phase, said Sergey Donskoy, an adviser to the company's general director, in early October. She built the infrastructure of the first stage - a gas treatment facility, a product pipeline, and a reception and storage complex. At the second stage, the INC will construct a gas treatment unit at the Markovskoye field and a gas processing plant. It will produce ethane, which will become the raw material for the polyethylene plant. This plant should be built by 2023, its products will be supplied to the domestic market and abroad, mainly in the Asia-Pacific region.

Why INC. Partners

Until now, the Irkutsk Oil Company was engaged only in oil production (in 2017 it produced 8.5 million tons), therefore, it is looking for partners for a new business line. “This is not exactly the competence of the Irkutsk Oil Company, it is downstream (processing. - RBC). We need partners with experience. Negotiations are underway with Japanese companies - the Japanese National Corporation for Oil, Gas and Metals (JOGMEC), Itochu Corp. and INPEX Corp. ”, - said Nikolay Buynov in an interview with“ Vedomosti ”in 2015. According to him, the INC is looking for investors "neatly," it should be a "clear and clear global partner." RBC sent requests to these three Japanese companies.

Sibur has built polypropylene production in Tobolsk (Sibur-Tobolsk, 510 thousand tons of polypropylene per year), is now finishing the second huge project for the production of polyethylene and polypropylene - Zapsibneftekhim, also world-class, reminds analyst of Gazprombank Evgenia Dyshlyuk. Sibur is the leader of the Russian petrochemical industry and has competencies and expertise in the construction of such complexes, and also has well-established distribution channels for base polymers in different regions in Russia and abroad, she explains. Sibur supplies products to 80 countries of the world, the company’s website says. INC’s interest in attracting such a partner to a gas chemical project is understandable, concludes Dyshlyuk.