LyondellBasell not part of Kazakhstan petrochemicals complex

26-Mar-10

Kazakhstan will commence the integrated petrochemical complex project in the Atyrau region on its own. Inability to find partners for the development and indecision n part of LyondellBasell on project participation since January, has compelled to company to start the development on its own. Kazakhstan Petrochemical Industries, the project operator, and Sinopec Engineering have recently signed an agreement for the cooperation in the first polypropylene production phase. Production capacity includes 400,000 tpa of low and high density polyethylene, 400,000 tpa of low density linear polyethylene and 400,000 tpa of polypropylene, once completed in 2014. The TengizChevroil joint venture signed a contract in March last year to supply 6-7 billion cubic meters of gas to this complex per year. The initial cost of the project was US$5.2 bln which later increased as the raw material prices grew. The funding issue had already been solved. The Export-Import Bank of China will provide a US$1.26 bln loan for the project. Kazakhstan Petrochemical Industries, 51% held by the London-traded unit of state-owned KazMunaiGaz National Co., will invest US$300 mln of its own money, and Kazakhstan will provide a “budget credit” of US$140 mln.