Moscow. May 18. INTERFAX.RU — KazMunayGas (KMG) and China Petroleum & Chemical Corporation (Sinopec) signed an agreement on principles regarding the joint implementation of a project for the production of polyethylene in the Atyrau region of Kazakhstan, the press service of KMG reported.

The agreement was signed on May 18 during the state visit of the President of Kazakhstan Kassym-Jomart Tokayev to China.

“The document assumes the entry of Sinopec into the project as a full partner on a par with SIBUR. As part of the entry of Sinopec in the future, the parties will sign an agreement on the purchase of shares and other binding documents,” the message says.

It is specified that the final investment decision (FID) by the project participants is expected in 2024.

“I am confident that Sinopec’s successful experience in the design, construction and operation of such technologically complex petrochemical facilities will have a positive impact on our project, as well as increase the investment attractiveness of Kazakhstan’s petrochemical industry,” Magzum Mirzagaliyev, Chairman of the Management Board of KMG, said through the press service.

It is assumed that the entry of Sinopec as an equal partner will make it possible to use the company’s technologies and expertise in the construction of petrochemical facilities, as well as in the future to organize the sale of finished products in China.

In November 2022, the state fund “Samruk-Kazyna”, “KazMunayGas”, “SIBUR Holding” and the participants of the companies operating the petrochemical projects “Polypropylene” and “Polyethylene” signed the main documents on the establishment of joint ventures based on “Kazakhstan Petrochemical Industries Inc.” (KPI Inc., the Polypropylene project) and Silleno LLP (Polyethylene project). The parties defined the terms of partnership in the joint venture located in the territory of the special economic zone “National Industrial Petrochemical Technopark” in Atyrau, in particular, investment in the construction project of a polyethylene plant with a capacity of 1.25 million tons per year, as well as the procedure for the sale of finished products of the enterprise for the production of polypropylene with a capacity of 500 thousand tons per year.

SIBUR’s share in each joint venture is 40%. The KPI Inc. polypropylene production plant was launched in early November 2022, and has been gradually increasing production since then.