Page 11 - DMEA Week 08 2023

DMEA PETROCHEMICALS DMEA

China considers investments in

Mahshahr petrochemical zone

IRAN CHINESE investors visited Iran’s Mahshahr provide $300-400bn in foreign direct investment
Petrochemical Special Economic Zone (MSEZ) (FDI) to the Iranian oil, gas and petrochemical
last week to discuss plans to invest $50mn into industries.
the area to build a carbon-sulphur production According to the co-operation plan, China
plant. During the visit, existing infrastructure will invest $400bn in Iran’s economy in exchange
was inspected and meetings were held with the for steady and heavily discounted supplies of oil.
current CEOs of the MSEZ, including managers A 2019 report by the Petroleum Economist said:
of the Razi petrochemical company. “China will be able to buy any and all Iranian oil,
Points raised in the talks included feedstock gas and petrochemical products at a minimum
requirements for the investment plan and the guaranteed discount of 12% to the six-month
general feasibility of the of the project in the rolling mean price of comparable benchmark
region. The visit follows Iranian President Ebra- products, plus another 6% to 8% of that metric
him Raisi’s recent trip to China, and the pro- for risk-adjusted compensation.”
posed investments are emblematic of the two Rumours that Iranian islands were to be
countries’ 25-year co-operation plan, first pro- leased to China as part of the deal have been
posed by Chinese leader Xi Jinping in 2016 and categorically denied. The spokesman for the Ira-
signed in 2021. nian foreign ministry said: “There is no handing
Around 2012, China owed Iran over $20bn in over of the Iranian islands, no presence of mili-
oil payments; however, US sanctions at the time tary forces and no other illusions.” Officials also
made transfers of money to Tehran from Beijing denied discounted Iranian oil and petrochemical
difficult. The 25-year plan saw China agree to sales to China.™

Gulf investors may buy a minority stake

in merged Egyptian petrochem company

EGYPT GULF investors have expressed interest in currently owns 20% of Ethydco, making it the
buying a minority stake in the merged entity second-largest shareholder in the company,
between two local petrochemical firms, Sidi whose other shareholders are state-owned firms
Kerir Petrochemicals (Sidpec) and the Egyptian and financial institutions.
Ethylene and Derivatives Company (Ethydco) Ethydco was established in 2011 and capi-
that was included in the government’s privatisa- talised at $1.9bn to produce linear low and high
tion programme last week. density polyethylene and polybutadiene. Last
AL Mal newspaper reported citing high-level year, Sidpec expressed an interest in fully acquir-
sources in the know. The size of the stake on offer ing Ethydco through a share swap to create a
is 16-20% in the merged entity. Majority state- petrochemicals leader in Africa and the Middle
owned, Egyptian Stock Exchange-listed Sidpec East. ™

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