Rosneft and ChemChina sign up to giant FEPCO petrochemical JV

Igor Sechin (Rosneft) and Ren Jianxin (ChemChina) June 2016FEPCO: China’s chemical giant ChemChina yesterday agreed to enter into a joint venture with Rosneft to help Russia’s largest oil company move ahead with its plans for the construction of a state-of-the-art petrochemical complex as it looks to capitalise on growing industrial and consumer demand in the Asian markets on its doorstep. CEO Igor Sechin and ChemChina’s Ren Jianxin had already signed a heads of agreement earlier in the summer and put their names to this more substantial document during a meeting between the Russian and Chinese Presidents Putin and Xi in Hangzhou on Sunday.
Under the terms of the agreement, ChemChina will buy a 40% stake in Rosneft’s Far Eastern Petrochemical Company (FEPCO) subsidiary, formerly known as Vostochnaya Neftechemicheskaya Company (VNHK). The complex is being built near the Pervostroyiteley village in the Nakhodka City District in Russia’s Far East at a location deliberately chosen for its proximity to South East Asia.
NakhodkaOn completion in 2028, FEPCO has been designed to have an annual production capacity of 1.4mtpa of ethylene, 600,000t of propylene, 230,000t of benzene and approximately 200,000t per annum of butadiene – making it the world’s biggest steam cracker by volume – and 50,000t per annum of linear alpha-olefins. The complex is expected to create up to 100,000 jobs and to generate $20bn in revenues by 2030.
The idea for the project first came to light in 2010 and Rosneft has already invested $48m in the complex and bought Japan’s Mitsui in to help with design and technology.
“The FEPCO project will become a new milestone in the partnership between our countries and will further strengthen Russian-Chinese economic ties,” Sechin told reporters after the signing. “The creation of a joint venture will help us shape the development structure of one of the world’s most advanced petrochemical projects that will have direct access to the Asia-Pacific market,” Sechin told reporters.

Source: sputniknews