Russia’s Sibur to proceed with $9.5bn ZapSibNeftekhim project

SINGAPORE (ICIS)–Russia-based petrochemical major Sibur will proceed with its plans to build a 1.5m tonne/year gas-fed ethylene cracker at Tobolsk , the company said on Tuesday.

The ZapSibNeftekhim project will also include 500,000 tonnes/year of propylene, 100,000 tonnes/year of butane-butylene fraction (BBF)], along with units that will produce 1.5m tonnes/year of various grades of polyethylene (PE), the company said in a statement.

The project will also include a 500,000 tonne-year polypropylene (PP) unit, it added.

The cracker, PE and PE units’ front-end engineering design has been completed, according to Sibur,

According to preliminary estimates by Sibur, total investment in the ZapSibNeftekhim project will amount to about $9.5bn including the expenditure already incurred and costs budgeted for commissioning.

SIBUR has also signed an agreement to design infrastructure and off-site facilities with Russia-based NIPIgazpererabotka, it said.

Production site infrastructure construction and other works for the project are to be completed within five and a half years, according to Sibur.

With the ZapSibNeftekhim project going ahead, Sibur’s board of directors has approved increased funding for the project this year, with overall capital expenditure (capex) budget for 2014 increasing from Russian rubles (Rb) 53 bn to Rb74 bn.

($1 = Rb38.33)