It is the third time that Tatarstan has become the leader among Russian regions in terms of the investment climate. Its investment attractiveness is built mainly by the industrial flagships. In particular, to ensure implementation of a number of investment programmes, a promising Memorandum of Strategic Cooperation was signed between TAIF Group and Linde, Germany, in the framework of a leading world business platform – St. Petersburg International Economic Forum. The details of the agreements confirmed by the signatures of the heads of these two major holdings in the presence of Rustam Minnikhanov, the President of Tatarstan, and Horst Zeehofer, Prime Minister of Bavaria, are covered in the material of Realnoye Vremya.
15-Year Preparation To Project
In early June, the Memorandum, which defines the main areas of cooperation till 2025, was signed by Christian Bruch, Chief Operating Officer, LINDE AG, and Albert Shigabutdinov, General Director, TAIF PSC. As Realnoye Vremya reported earlier, the Memorandum envisages a number of contracts covering both gas separation and process gases, and, most importantly, the contracts related to the four stages of the Ethylene Complex at Nizhnekamskneftekhim, a company of TAIF Group. The initial stage of the Memorandum implementation was a basic agreement on the engineering and commissioning of a new EP-600 plant - the first phase of the Olefin Complex with a capacity of 1,200 thousand tons for ethylene. According to Albert Shigabutdinov, General Director, the preparation to the Olefin Complex Project has taken 15 years, of which the last 10 years have been the most intense. 'These efforts have paid off with the first major contract, which costs nearly one billion euros,' Albert Shigabutdinov said. He noted that initially there were dozens of companies seeking the contract, but finally a German company was selected. It proposed the best technologies at the best price.
'It seems to everyone that we just sit down and sign, but in reality this was a colossal work, which required a plenty of energy, moral and physical efforts, knowledge, and meetings. We had to go a long way, and implement small projects first to gain experience and to sign such a document. I believe, once launched, the projects will show high competitiveness not only domestically, but worldwide,' forecasted the head of TAIF. It will be recalled that the complex will be built in four stages - the second and the forth stages with the capacity of 600 thousand tpa for ethylene - plus connected plants producing high value-added polymers out of ethylene, the basic raw material. The parties agreed that Linde would assist TAIF in further implementation of the second, the third and the fourth stages with the purpose to produce high added value petrochemical products.
At the time being, according to the General Director of Nizhnekamskneftekhim, the company has to obtain financing for the project: financing confirmation shall be procured together with the German partner from export credit agencies along with approval from the banks. Afterwards, engineering work will commence. Nizhnekamskneftekhim will develop project documentation and the detailed design. In parallel, the work on identification and procurement of equipment will be carried out. 'It is planned to implement the project by 2021,' Azat Bikmurzin shared the plans regarding the first phase of the Ethylene Complex.
Kazanorgsintez To Build Gas Processing Plant
Memorandum will give an impetus to another important project - Linde will assist TAIF in the construction of a gas processing plant and a petrochemical complex at the premises of Kazanorgsintez PJSC (KOS). The point is that the programme of the future development of Kazanorgsintez envisages the construction of a new gas processing plant with a capacity of 30 million cubic meters per year. This plant will supply raw materials for a new 1 mln tpa ethylene plant.
'In Western Siberia, there are natural gas reservoirs with a high content of wet gases such as ethane, propane, butane, as well as pentane, hexane, and heptane. There is a corridor, in which the pipeline is laid for Kazan CHPP-3; in the same corridor we will lay a pipeline for the gas processing plant. There is an area near Kazanorgsintez, which is reserved for new construction. Hydrocarbons will be extracted from wet gas and later used as feedstock for ethylene and other basic petrochemical products production. And ethylene will be further processed into low density and high density polyethylene at the existing and new polyethylene production units,' explained Rafael Safarov, Chief Engineer of KOS.
At the same time, the head of TAIF clarified that there are gas pipes crossing the territory of Tatarstan pumping ca. 300 billion cubic meters of natural gas a year. This mainly referes to gas produced in Urengoy, Yamal Peninsula. And every year this gas contains more and more gas compounds: ethane, propane, butane, and isobutane. In some gas fields, the concentration of these compounds reaches 14 — 15%, though earlier it never exceeded 0.5 - 1%.
'Therefore, we proposed to explore the possibility of joint actions together with Gazprom, Sibur, and Novatek in respect of wet gases transportation through a separate pipe to Tatarstan and its processing here,' explained Albert Shigabutdinov. And just at the end of the last month, Gazprom confirmed technical feasibility of wet gas delivery to Tatarstan. The company may lay a separate pipe for a new gas processing plant to be built in the republic. However, General Director of Gazprom Mezhregiongaz Kirill Seleznyov said it's too early to discuss the discuss until the feasibility studies are completed.
TAIF Group and Linde agreed to consider further cooperation concerning the implementation of projects in the field of industrial gases supply, gas processing and petrochemicals in Kazan and Nizhnekamsk.
Linde To Establish Training Center in Kazan
In addition, LINDE AG came up with the proposal to open LINDE's Training Centre at the premises of Kazan National Research Technological University in order to train and retrain specialists, with implementation of a dual training system together with TAIF at the premises of Kazanorgsintez PJSC and Nizhnekamskneftekhim PJSC. Cooperation in the field of engineering, researches and education implies the companies' collaboration on the establishment of an R&D center or a pilot units fleet.
Besides, TAIF Group will consider the proposal of LINDE AG on the acquisition of a hydrogen plant and an air separation unit by the latter from TAIF-NK PSC with the purpose to produce and supply industrial gases to TAIF's enterprises on an outsourcing basis. During one of the visits to Munich in early April, TAIF's General Director noted that the company, in principle, is ready to sell the hydrogen plant to Linde after 1-1.5 years of successful operation.
TAIF and Linde have agreed to form a working group for the development and coordination of all the projects covered by the Memorandum. According to TAIF's preliminary estimates, the investments in the implementation of joint projects will amount to EUR 12 billion.