Chinese firm to invest €3.4m to build Kazakhstan polyolefins complex

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China has agreed to invest around €3.4 billion to construct a petrochemical and polyolefins complex in the Aktyubinsk region of the central Asian state of Kazakhstan.

Representatives of the Chinese firm Tianjin Bohua Petrochemical, part of the Tianjin Bohai Chemical group, signed a cooperation agreement for the project with the Kazakh regional governor Berdybek Saparbayev in Beijing recently.

The complex is due to be constructed in two separate phases. In the first stage, a plant capable of producing 1.8m of methanol from natural gas feedstock will take shape. A further phase will see the building of a 300,000tpa ethylene plant as well as two 300,000tpa units for polyethylene and polypropylene respectively.

The Kazakh scheme is expected to create a total of 3,000 new jobs and should be completed finally by 2021, according to Kazakhstan’s Kazinform news agency.

Petrochemicals output will be aimed primarily at markets in China and Kazakhstan but the complex is also set to supply neighbouring countries.

During talks in Beijing, Tianjin Bohua Petrochemical company president Zhou Kai topics reported to have been covered include the provision of natural gas and electricity for production at the complex, training of Kazakh labour, new technology use and compliance with Kazakhstan’s environmental legislation.

The Chinese have taken on this major central Asian project where other foreign investors have previously feared to tread. Two years ago, the South Korean company LG Chem abandoned a longstanding plan to invest €3.84m to establish an 800,000tpa PE complex in western Kazakhstan.

The firm, part of Korea’s giant LG group, pulled out of the local joint venture, including a proposed 840,000tpa ethylene plant, in Atyrau blaming sharply rising investment costs and low oil prices.

LG said in early 2016 it preferred to divert its investment funds to “more promising” business areas.

The Aktyubinsk project is understood to be intended to be linked to China’s regional New Silk Road (‘One Belt,One Road’) development initiative.

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