KMG, SIBUR, Sinopec sign protocol on participation of Kazakh suppliers for polyethylene project

ASTANA. July 3 (Interfax) - KazMunayGas JSC (KMG), SIBUR Holding PJSC and Sinopec Overseas Investment Holding have signed a protocol on the Silleno (Polyethylene) project, the KMG press service reported.

The document was signed as part of the 7th meeting of the Kazakh-Chinese Business Council on the eve of the Shanghai Cooperation Organization (SCO) summit in Astana on Tuesday.

"The parties confirmed their intention to agree on the final investment budget for the implementation of the Silleno project. The protocol reflects the commitment of the parties to ensure the highest level of local content in the field of design, procurement of equipment and materials, as well as construction during the implementation of the project, taking into account economic and technical feasibility," KMG said.

"The polyethylene production project is an important stage in the development of the petrochemical industry. Its implementation will have a multiplier effect on the country's economy, which is expected to lead to an increase in GDP by 1.2%," it said.

The polyethylene project involves the construction of a polyethylene production plant with a capacity of 1.25 million tonnes per year in the Atyrau region in western Kazakhstan.

In November 2022, the state fund Samruk-Kazyna, KazMunayGas, SIBUR Holding and participants of the operating companies of the petrochemical projects Polypropylene and Polyethylene signed the main documents on the creation of joint ventures on the basis of Kazakhstan Petrochemical Industries and Silleno LLP.

In May 2023, an agreement was signed on the entry of the Chinese Sinopec into the Polyethylene project as a full partner, and in April 2024 the company officially became a co-founder.

Shares in the project are distributed as follows: KazMunayGas - 40%, SIBUR - 30%, Sinopec - 30%.

The estimated cost of the project is $7.7 billion. The plant is expected to be completed in 2028.