Lukoil starts building gas chemical complex in southern Russia

STAVROPOL. Aug 29 (Interfax) - Lukoil has laid the foundation stone for a gas chemical complex at its Stavrolen plant in Budennovsk, Stavropol Territory, the Russian oil company said on its website.

The project, which will include production of high-demand mineral fertilizers urea and ammonia, will enable Lukoil to monetize natural gas from its fields in the North Caspian.

The complex will produce about 1.75 million tonnes of urea annually, the regional government said. The project is expected to take five years.

"The construction of a new super-modern production facility is of strategic importance for the region. This is not only additional tax revenue, but also about 600 new jobs. The industrial facility will also help strengthen associated infrastructure - road, utility and social. It's important that the investor devoted particular attention to compliance with all environmental safety standards," Governor Vladimir Vladimirov was quoted as saying by the press service.

Investment in the project will total 163 billion rubles, the regional Economic Development Ministry said.

Stavrolen LLC, which is wholly owned by Lukoil, is Russia's second largest producer of high density polyethylene after Kazanorgsintez and third largest producer of polypropylene after Nizhnekamskneftekhim and Tomskneftekhim. Stavrolen's plant currently processes more than 2 billion cubic meters of gas per year.