Borealis and UCC sign Joint Development Agreement in Abu Dhabi for advancing world-scale polyethylene project during the visit of the President of Kazakhstan with the Crown Prince of Abu Dhabi
Borealis and United Chemical Company LLP (UCC) have signed a Joint Development Agreement (JDA) for the development of a world-scale polyethylene project, integrated with an ethane cracker, in the Republic of Kazakhstan.
Simultaneously, a government support agreement was signed between the two companies and Samruk-Kazyna Chief Executive Akhmetzhan Yessimov as well as the government of the Republic of Kazakhstan, represented by the Minister of Energy, Mr. Kanat Bozumbayev. A Memorandum of Understanding (MoU) was also signed to cooperate on a 500 ktpa polypropylene project that is currently being implemented by Samruk-Kazyna Sovereign Wealth Fund and is under construction. The agreements were ceremoniously signed in Abu Dhabi on 24 March 2018 by the Ministers of Energy of Kazakhstan and of the UAE, in the presence of the President of Kazakhstan, H.E. Nursultan Nazarbayev and the Crown Prince of Abu Dhabi, H.H. Mohammed bin Zayed bin Sultan Al-Nahyan.
The companies, represented by Mark Garrett, Borealis Chief Executive and by Zhenis Osserbay, UCC Chief Executive, then also signed the agreements.
The signing of the JDA comes after the successful conclusion of a pre-feasibility study. The project will now move into the feasibility study phase, which is expected to run until Q1 2019. After the successful completion of the feasibility study confirming the attractive project parameters, a local JV with UCC will be set up*.
The scope of the JDA will include the construction of an ethane cracker and 2 Borstar® PE units, with a total capacity of 1.250 ktpa and with a pre-investment in the cracker for future expansion. The final investment decision on the project is expected to be taken in 2020 and start-up would be scheduled for 2025.
Through this strategic partnership, Borealis and UCC are exploring the opportunities of jointly developing the Kazakhstan polyolefin industry.
“The project is well aligned with the country’s strategy to develop its petrochemical industry and would serve as a strong basis for establishing Kazakhstan on the global polyolefin market,” said Samruk-Kazyna Chief Executive Akhmetzhan Yessimov.
“This project would significantly strengthen Borealis’ position in the CIS markets; adjacent to our home market, with growth rates above WE and significant potential for development of advanced PE business based on our Borstar technology,” said Borealis Chief Executive Mark Garrett.
“A polyethylene plant of this scale would be a significant step forward in creating long term, sustainable value for Kazakhstan from its petrochemical industry,” said Zhenis Osserbay, UCC Chief Executive. “We look forward to continuing our work with Borealis in developing this opportunity.”
* Subject to regulatory approvals
END
For further information please contact:
Borealis:
Virginia Mesicek
External Communications Manager
tel.: +43 (0)1 22 400 722 (Vienna, Austria)
e-mail: virginia.mesicek@borealisgroup.com
UCC:
Askar Zhusupov
External Communications
Tel: +7 7172 73 71 27
e-mail: zhusupov@ucc.com.kz