Construction of SOCAR Polymer plant to cost $700 mln
BAKU. April 10 (Interfax) - Investment in the construction of a petrochemical complex in Sumgait to produce base polymers will total an estimated $700 million, Azerbaijan's Caspian Energy journal reported, citing SOCAR Polymer, the plastics division of the State Oil Company of Azerbaijan Republic (SOCAR).
This figure includes the construction of two plants, a central office and storage facilities, the journal said.
The founders of the company will finance 40% of the cost and the remainder will be financed with loans, the article said, adding that SOCAR Polymer has already raised $420 million from Russia's Gazprombank . The financing was secured in December.
The company will begin building a polypropylene plant with annual capacity of 180,000 tonnes in the summer of 2015. Completion is scheduled for 2017. A polyethylene plant, which will primarily manufacture high-pressure plastic pipes and will have capacity of 120,000 tonnes per year, is expected to open in 2018.
The company has already determined its strategy for purchasing feedstock and selling products on the domestic and international markets. SOCAR Polymer has signed a contract with SOCAR to 2030 for the purchase of feedstock in the form of propylene, ethylene and hydrogen.
SOCAR Polymer also plans to sign an agreement with SOCAR Trading for the guaranteed sale of manufactured products on the international market. Negotiations are also underway with SOCAR's marketing and economic operations department concerning sales on the domestic market.
SOCAR Polymer was founded by SOCAR and has charter capital of $100 million. SOCAR now owns 51% of the company, and Pasha Holding, Gilan Holding and Azersun Holding hold the remaining 49%.
It was reported earlier that the first phase of SOCAR's plans to build an oil and gas processing complex (OGPC), from 2015 to 2020, involves building a gas processing plant, polyethylene and polypropylene production plants, and general plant infrastructure. The second involves building a new oil refinery.
