KazMunayGas, Sinopec, SIBUR discuss resource planning for Polyethylene project

ASTANA. Jan 30 (Interfax) - Executives from KazMunayGas (KMG), China's Sinopec and Russian petrochemical company SIBUR held talks on Kazakhstan's Polyethylene project in China, the Kazakh oil and gas company reported.

The companies discussed the current status of the project, including the completion of the process of Sinopec's legal accession to the project, which, as reported earlier, is expected in the first quarter of 2024.

The project has already entered the EBD (Extended Basic Design)/FEED (Front End Engineering Design) stage, KMG said.

"We discussed technical aspects and resource planning for the implementation of the Polyethylene project. We expect a final investment decision to be made this year, which will be the springboard for transitioning to the important stage of starting construction," KMG CEO Magzum Mirzagaliyev said in the press release.

The project, the estimated cost of which is $7.7 billion, involves building a plant to produce polyethylene with capacity of 1.25 million tonnes in the Atyrau region in western Kazakhstan. The plant is expected to be completed in 2028.

Kazakhstan's sovereign wealth fund Samruk-Kazyna, KMG, SIBUR Holding and participants in the operating companies of the Polypropylene and Polyethylene petrochemical projects signed the main documents on the formation of joint ventures based on Kazakhstan Petrochemical Industries Inc. (KPI Inc., Polypropylene project) and Silleno (Polyethylene project) in November 2022. The parties defined the terms of their partnerships in the joint ventures, including investment in the project and the procedure for selling the finished product.

An agreement for Sinopec to join the project as a full-fledged partner was signed in May 2023.

KMG said it will hold a 40% stake in the project, and Sinopec and SIBUR will each hold 30% stakes.