Borealis and UCC Sign Joint Development Agreement
World-Scale Polyethylene Project in Kazakhstan
Borealis AG, Vienna, Austria, and United Chemical Company LLP (UCC), Astana, Kazakhstan, have 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.
Simultaneously, a government support agreement was signed between the two companies and Samruk-Kazyna Chief Executive Akhmetzhan Yessimov as well as the government of the Republic of Kazakhstan, represented by the Minister of Energy, Mr. Kanat Bozumbayev. A Memorandum of Understanding (MoU) was also signed to cooperate on a 500 ktpa polypropylene project that is currently being implemented by Samruk-Kazyna Sovereign Wealth Fund and is under construction. The agreements were ceremoniously signed in Abu Dhabi on 24 March 2018 by the Ministers of Energy of Kazakhstan and of the UAE, in the presence of the President of Kazakhstan, H.E. Nursultan Nazarbayev and the Crown Prince of Abu Dhabi, H.H. Mohammed bin Zayed bin Sultan Al-Nahyan. The companies, represented by Mark Garrett, Borealis Chief Executive and by Zhenis Osserbay, UCC Chief Executive, then also signed the agreements.
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 (subject to regulatory approvals). The scope of the JDA will include the construction of an ethane cracker and two Borstar PE units, with a total capacity of 1250 kt/a 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.
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