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SIBUR updates organisational model of its plastics and rubber business

December 03/2021

MOSCOW (MRC) -- The merger of SIBURís and TAIFís historical assets resulted in an exponential growth of plastics, elastomers and organic synthesis business in terms of absolute volume of production, range and applications of products, said the company.

The Company believes that this offers a great potential for further development. To that end, a decision has been made to divide the Plastics, Elastomers and Organic Synthesis Division into two standalone business units both supervised by Sergey Komyshan, SIBURís Management Board member and Executive Director. Member of the Management Board and Managing Director Alexander Petrov will be the Head of the Plastics and Organic Synthesis Division, while Timur Shigabutdinov, another member of the Management Board and Managing Director, will be in charge of the Synthetic Rubbers Division.

The Plastics and Organic Synthesis Division will consolidate assets with a total capacity of some 3 mtpa. The Divisionís further expansion will be driven by the development of medium-tonnage chemicals, which enjoy strong demand in the Russian market. Once implemented, the respective projects will substitute imports of products such as MAN and DOTP and make a strong contribution to the growth of Russiaís non-commodity exports. In addition, the Company plans to use this business to expand the production of feedstock for high-margin products in the specialty chemicals segment, which currently has an insignificant presence in the domestic market.

Mr Petrov will also continue to supervise SIBURís production support function as it pursues increasingly ambitious goals Ė integrate procurements within the combined company, keep pace of changes and implement the existing functional initiative portfolio: import substitution, category strategies, optimisation of technical solutions, and use of digital tools.

The standalone Synthetic Rubbers Division was established in response to a more than 3-fold increase in the rubber business as a way to focus on delivering operational improvements for rubber production facilities, which today have a total capacity of around 1.2 mtpa. The Division will be responsible for developing new grades with unique consumer properties, creating customer services and offering comprehensive solutions, as well as expanding footprint across segments and geographies. With its unparalleled integrated business model, the combined company will be able to ramp up the efficiency of its rubber business by increasing the availability of feedstock, predominantly butadiene, and develop production of most popular butadiene-based rubbers going forward.

Alexander Petrov, Head of the Plastics and Organic Synthesis Division, member of the Management Board and Managing Director of SIBUR, said: "Our aim is to considerably scale up our business by relying on medium-tonnage chemicals projects focused on import substitution. An important part of that will be securing the right set of projects to make use of monomers from the new Nizhnekamskneftekhim cracker and benefit from the integration of processes of SIBURís traditional supply chain and its new asset perimeter. Another goal for us is to increase the presence of our products in the construction industry, partly by expanding our range of grades and partly by offering customers new solutions and replacing traditional construction materials with polymers."

Timur Shigabutdinov, Head of the Synthetic Rubbers Division, member of the Management Board and Managing Director of SIBUR, said: "The combined company boasts an unrivalled portfolio of synthetic rubbers. Our priority is to respond to customer needs by further growing the business using the expertise under our belt, cutting-edge R&D assets, and access to the latest technologies. Once all the investment projects are completed, these initiatives will make SIBUR one of the world's Top 5 synthetic rubber producers."

In October, SIBUR closed the deal to acquire 100% of TAIF JSC, which includes Nizhnekamskneftekhim, Kazanorgsintez and TGK-16.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,868,160 tonnes in the first nine months of 2021, up by 18% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,138,510 tonnes in January-September 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding statistical copolymers of propylene (PP random copolymers) decreased significantly.

SIBUR manufactures and sells petrochemical products on the Russian and international markets in two business segments: olefins and polyolefins (polypropylene, polyethylene, BOPP, etc.), as well as plastics, elastomers and intermediate products (synthetic rubbers, expanded polystyrene, PET, etc.).
Author:Anna Larionova
Tags:petroleum products, PP, PE, neftegaz, petrochemistry, Taif, Kazan, Sibur Holding.
Category:General News
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