Rosneft, Sinopec plan petchem complex for East Siberia

Russia’s OJSC Rosneft and China Petrochemical Corp. (Sinopec) have entered a framework agreement to jointly develop a grassroots natural gas processing and petrochemical complex in East Siberia.

Signed on June 25, the agreement furthers a December 2015 memorandum of understanding signed by the companies to cooperate on petrochemical projects, Rosneft said.

Alongside providing for a prefeasibility study on construction and operation of the joint project, the agreement stipulates for selection of processing technology to be used at the complex and for selection of a project management consultant (PMC).

The companies additionally agreed to identify potential competitive challenges as well as a timeframe to address them before moving forward on front-end engineering design, Rosneft said.

Pending favorable results of preliminary activities to be completed as part of the framework agreement, Rosneft and Sinopec will establish a joint venture to advance the project sometime in 2017.

Details regarding selection of technology licensing, PMC, and FEED were not disclosed.

Designed to help meet the growing demand for polyethylene and polypropylene in Russia and China, the proposed complex would have a capacity to process 5 billion cu m/year to produce 3 million tonnes/year of polymers and petrochemical products primarily for Russian and Chinese markets.

To be located in Boguchany district of Russia’s Krasnoyarsk Territory, the complex would use feedstock supplied from Rosneft’s oil and gas fields in eastern Siberia’s Yurubcheno-Takhomsky cluster (OGJ, Aug. 12, 2013, p. 24), Rosneft said.

Under the original MOU for the project, the companies planned to execute a detailed prefeasibility and concept-design study for an integrated 10 billion-cu m/year complex to be built in Boguchany and Angarsk that would produce 3 million tpy of ethylene and about 6 million tpy of polymers and other petrochemicals, according to a Dec. 17, 2015, news release from Rosneft.

Contact Robert Brelsford at rbrelsford@ogjonline.com.

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