London +4420 814 42225
Moscow +7495 543 9194
Kiev +38044 599 2950

Our Clients

Order Informer

Home > News >

Russian petrochemical group Sibur in talks with Saudi Aramco venture

March 07/2018

MOSCOW (MRC) -- Russian petrochemical group Sibur is in talks with Saudi Aramco to set up a venture to produce synthetic rubber, its chief said in a move highlighting growing cooperation between OPEC leader Saudi Arabia and Russia, the biggest non-OPEC oil exporter, reported Reuters.

Russia and Saudi Arabia have forged closer ties in the past two years as part of efforts to prop up oil prices by curbing output.

The deal between OPEC and Russia has opened the door to political dialogue and has also encouraged talks on broader bilateral investment in the energy sector.

"The Saudi-Russian dialogue has probably accelerated the project, even though we started discussion some four years ago," Sibur head of management board Dmitry Konov told reporters.

The two companies signed a cooperation memorandum last year when Saudi King Salman visited Russia but so far have not disclosed project details.

Konov said Sibur was looking to export its synthetic rubber technology because of low feedstock availability in Russia and low domestic demand growth.

Good feedstock availability in Saudi Arabia and growing Asian markets could make the project attractive, Konov said.

He said the venture would likely involve other companies as it would require technologies which Sibur or Aramco do not possess.

Sibur focuses mainly on serving clients in the former Soviet Union but its exports of polymers are set to rise with the launch of a new USD9 billion plant in Tobolsk in Siberia over the next couple of years.

It also wants to build a major complex in east Siberia in the next decade to serve Asian markets as part of a broader plan by gas export monopoly Gazprom to supply gas to China.

Konov said he saw global competition rising steeply due to the U.S. shale oil boom, which provides cheap feedstock to the local petrochemical industry.

The International Energy Agency raised its outlook for U.S. shale oil growth this week, saying the country was poised to grab market share from rival OPEC and further develop its chemical industry.

The IEA also said petrochemicals would become one of the main sources of global oil and gas demand growth.

Konov said that despite rising U.S. output, global demand for polymers was set to grow faster than U.S. capacity additions, meaning the market was unlikely to face a significant glut anytime soon.

"People are more concerned about having not enough projects rather than having too many," he said.

As MRC informed before, SIBUR Tobolsk, Russia's largest PP producer, manufactured 47,700 tonnes in January 2018 versus 46,400 tonnes and 46,700 in January and December 2017, respectively. Overall PP production at the Tobolsk plant exceeded 510,500 tonnes last year.

SIBUR is a uniquely positioned vertically integrated gas processing and petrochemicals company. We own and operate Russias largest gas processing business in terms of associated petroleum gas processing volumes and are a leader in the Russian petrochemicals industry. As of 31 March 2014, SIBUR operated 27 production sites located all over Russia, had over 1,400 large customers engaged in the energy, chemical, fast moving consumer goods (FMCG), automotive, construction and other industries in approximately 70 countries worldwide and employed over 27,000 personnel.
Author:Margaret Volkova
Tags:PP, PE, crude and gaz condensate, petrochemistry, natural rubber, synthetic rubbers, Sibur Holding, Saudi Aramco, Sibur Tobolsk.
Category:General News
| More

Leave a comment

MRC help


 All News   News subscribe