5 Feb 2010 19:44

TAIF could borrow $1.95 bln for oil residue conversion plant

KAZAN. Feb 5 (Interfax) - TAIK-NK, a subsidiary of the Tatarstan-based TAIF holding company, could borrow up to $1.95 billion to build heavy oil residue conversion plant, the holding's company's general director, Albert Shigabutdinov, told Interfax.

Shigabutdinov said the project might cost $2.3 billion overall, and that no more than 80%-85% of this would have to be borrowed.

TAIF-NK itself is financing the initial stage, consisting of design and license acquisition.

"Request for proposals will soon be sent to leading international institutions. Some have already been received. Then a tender will be conducted and the partners named," Shigabutdinov said.

Alexander Babynin, general director of TAIF-NK, told Interfax that the company had signed front-end engineering contracts with the UK division of UOP Limited in October for mechanical dewaxing and hydrocracking units and to acquire the technology at a cost of more than $10 million. The plans should be ready in April, after which a third technology, heavy residue gasification and hydrogen separation, will be acquired.

The Russian general designer is the Moscow-based OJSC VNIPINeft institute, and the general designer for the international aspect of the project is Germany's Lurgi.

The whole complex should be built in 2014. It will push TAIF-NK's overall throughput capacity up to 9.1 million tonnes from 8.2 million tonnes of crude and refining depth to 95%.

TAIF-NK was set up in 1997 and started to produce and market petroleum products in September 2005. Its refining cluster includes a primary refining plant, gas condensate plants and automobile gasoline plants.