Expansions: KazMunayGaz breaks ground on US$7 bn ethane cracker/PE project in Kazakhstan

Kazakhstan’s state-owned oil and gas company KazMunayGaz JSC NC (KMG) has started construction of a 1.25 million tonnes/year PE plant that will be part of a US$7 billion integrated gas-to-chemicals project at Atyrau, Kazakhstan, being developed together with Chinese chemical firm Sinopec and Russia’s Sibur.

The Silleno PE plant is scheduled for completion by 2028, with commercial production to start in 2029 and will produce more than 20 different grades of PE to meet domestic demand and export to markets in Europe, Turkey, China and CIS countries, it said.

KMG holds a 40% equity stake in the Silleno joint venture, with Sinopec and Sibur each separately holding 30%.

The project is anticipated to replace up to 90% of Kazakhstan’s current PE imports, which totalled about 300,000 tonnes in 2024, according to KMG. The country’s PE market could grow to 400,000 tonnes/year by 2035, it added.

The groundbreaking took place at the construction site within the National Industrial Oil and Gas Chemical Technopark located in a special economic zone at Atyrau, it said.

Initial preparatory work at the site started last year for the site’s 1.3 million tonnes/year steam cracker, for which Spain’s Técnicas Reunidas SA is the engineering, procurement and construction (EPC) contractor in a 50/50 joint venture with Sinopec Engineering Group. The EPC contract for the ethane cracker, valued at about EUR2.3 billion. 

The ethylene plant will use the ethane feedstock supplied by KMG’s planned 1.6 million tonnes/year gas separation plant in Atyrau, which will use natural gas piped from the Tengiz oil and gas field operated by Tengizchevroil LLP. KMG will also be responsible for constructing the gas pipeline, it said.

The cracker will use tech firm Lummus’s ethylene technology, while the ethylene polymerisation process will be based on licensed technologies from Chevon Phillips Chemical and Univation Technlogies. As well a butene unit will utilise technology from Axens.

The company is also considering plans in partnership with Sinopec for a PTA and PET plant in Atyrau. The PTA/PET plant would be operated by KMG subsidiary KMG PetroChem and be capable of processing up to 400,000 tonnes/year of p-xylene feedstock, according to KMG.

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