Borealis and UCC Move Ahead on Proposed Polyethylene Project in Kazakhstan

Austrian petrochemicals maker, Borealis, and Kazakhstan state-owned United Chemical Company (UCC) recently 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.

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 two PE units based on Borealis’ Borstar technology, 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.

“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,” commented Mr. Akhmetzhan Yessimov, CEO of Samruk-Kazyna. UCC was established in 2009 by the decision of the Board of Directors of the National Welfare Fund Samruk-Kazyna JSC. “A polyethylene plant of this scale would be a significant step forward in creating long term, sustainable value for Kazakhstan from its petrochemical industry,” added Mr. Zhenis Osserbay, UCC’s CEO.

“This project would significantly strengthen Borealis’ position in the CIS markets; adjacent to our home market, with growth rates above Western Europe and significant potential for development of advanced PE business based on our Borstar technology,” said Borealis’ CEO Mr. Mark Garrett.