Page 11 - AsianOil Week 01 2021

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Sinopec, Sibur close Amur GCC deal

PROJECTS & RUSSIA’S leading petrochemicals company
COMPANIES Sibur Holding and China’s top refiner Sinopec
Corp. have closed a $11bn deal to set up a joint
venture at the Amur Gas Chemical Complex
(Amur GCC) after obtaining all the necessary
approvals from both countries’ regulators, Sibur
said on December 28.
The long-discussed project has been in the
works for years and follows on from the com-
pletion of the ZapSibNeftekhim petrochemical
complex (ZapSib) in 2020.
Sibur and Sinopec signed off on a provisional
agreement to build the Amur Gas Chemical
complex in June 2019, at a signing ceremony
attended by Chinese President Xi Jinping and
Russian President Vladimir Putin at the St
Petersburg International Economic Forum
Amur GCC will (SPIEF) investment forum.
“The partnership will allow the parties to tap
have a capacity into shared expertise and experience to maxim-
of 2.7mn ise efficiency of new large-scale projects and to
exchange best practices”, Sibur chairman Dmitry
tonnes per Konov said at that ceremony.
Under the terms of the final agreement, Sibur
year, including and Sinopec will hold 60% and 40% respectively In keeping with the ongoing move towards
2.3mn tpy of in the Amur GCC joint venture. environmental, social and governance (ESG)
compliant production, Sibur stressed the project
The main terms and conditions of the poten-
polyethylene and tial joint venture were agreed in 2019, beginning would follow the highest global environmental
and technology standards, in particular through
the process of getting all corporate and regula-
400,000 tpy of tory approvals required to close the deal. Fol- its reliance on renewable energy sources.
Amur GCC’s construction budget is tenta-
polypropylene lowing the deal, the parties will gain joint control tively estimated at $10bn to $11bn and is sub-
over Amur GCC.
Set to become the world’s largest basic pol- ject to adjustments as the project progresses.
ymer production facility, Amur GCC will have In December, Amur GCC attracted $1.5bn in
a capacity of 2.7mn tonnes per year, including bridge financing from a syndicate of Russian
2.3mn tpy of polyethylene and 400,000 tpy of banks. Gazprombank acted as the lead arranger
polypropylene, and will produce a wide range and lender, with Otkritie and Sberbank as
of grades. arrangers and lenders.
The construction of Amur GCC proceeds Konov said: “Sibur and Sinopec have a long
in sync with the gradual ramp-up of Gazprom’s track record of jointly delivering on large-
Amur Gas Processing Plant to its full capacity, scale investment projects and implementing
so that the latter could supply ethane and liquid advanced production technologies. Creating a
petroleum gas (LPG) to Amur GCC for process- joint venture is a major milestone in our Amur
ing into high value-added products. The com- GCC project. With Sinopec’s involvement, we
pletion of construction and commissioning is will be able to maximise the project’s efficiency,
scheduled for 2024. The creation of Amur GCC in particular optimising and balancing the facili-
is part of Sibur’s strategy to move up the value ty’s future debt portfolio, while also enhancing its
chain and produce more valuable hydrocarbon expertise in distribution across Asian markets.”
products from the feedstock supplied by Russia’s Sinopec chairman Zhang Yuzhuo added:
major oil and gas producers. “Amur GCC is a milestone in the co-operation
“The Amur GCC project will help attract between Sinopec and Sibur, and will also become
international investments in the Russian econ- a model for Sino-Russian energy co-operation
omy while also making a considerable contri- to extend to the downstream chemical industry.
bution to the national programme of growing The success of Amur GCC will inject new impe-
the nation’s non-commodity exports. Given the tus into advancing the high-quality co-operation
facility’s geography, its products will be target- between the two countries in the fields of energy,
ing Asian markets, primarily China, which is chemical industry, investment, economy and
the largest consumer of polymers globally. The trade and play a positive role in effectively pro-
Amur GCC project is expected to be included moting the sound interaction of domestic and
in an intergovernmental agreement between international markets as well as the economic
Russia and China,” the company said in its press development, employment and social well-being
release. of the Far East region.”™

Week 01 07•January•2021 www. NEWSBASE .com P11