Russia Portrays Bear Market with Major CPI Projects Expected to Commence this Year

---

Researched by Industrial Info Resources (Sugar Land, Texas)--The headlines have been splattered over the past year concerning Russia's aggressive growth in the oil & gas sector, even going as far as the North Pole to make claims of possible drilling sites, but a byproduct of all the planned exploration and processing falls to the chemical sector. This year, over $2 billion worth of Chemical Processing Industry (CPI) projects are expected to begin construction in Russia.

Nizhnekamskneftekhim JSC (Nizhnekamsk, Russia) is planning major unit additions at its existing site in Nizhnekamsk. The units on the drawing board consist of a polystyrene unit addition that will produce 50,000 metric tons per year; a 70,000-metric-ton-per-year acrylonitrile butadiene styrene unit, which will be fitted with Polimeri Europa's process technology; and a revamp of a polybutadiene rubber unit that will raise the current capacity from 60,000 metric tons per year to 100,000 metric tons per year. The total investment value of all the projects equals $115 million.

Alco-Naphtha LLC (Moscow, Russia) has begun engineering on a $100 million grassroot polyethylene terephthalate (PET) plant in Kaliningrad, Russia. The company selected Inventa-Fischer GmbH & Company KG (Berlin, Germany) to serve as the engineering and construction firm for the project. Inveta-Fischer will also supply the process technology for the plant, which will produce 240,000 metric tons per year of bottle-resin PET.

Orenburggazprom LLC (Orenburg, Russia) is committed to construct a polyethylene and a polypropylene unit at its site in Orenburg. The two projects combined will require an estimated $850 million investment. The polyethylene unit will produce 650,000 metric tons per year and the polypropylene unit will produce 450,000 metric tons per year when both are operational.

Sibur LLC (Moscow, Russia) has teamed up with Solvay S.A. (Brussels, Belgium) to construct two world-scale chlor-alkali production units. One unit will produce 330,000 metric tons per year of polyvinyl chloride resins and the other will produce 225,000 metric tons of caustic soda. These units are valued at just under $1 billion for engineering, construction and commissioning. Sibur will also invest $65 million in building an expandable polystyrene unit at its Perm site to produce 50,000 metric tons of product.

So while much attention is given to Russian exploration of oil & gas, understand that these feedstocks have downstream uses to contribute to Russia's industrial growth. So as more resources are discovered and captured, more will be used to increase Russia's CPI market. The next five years could really be a bear market for Russian chemical producers as they continually increase and make plans for future increases of chemical products produced from world-scale production sites.

Industrial Info Resources (IIR) is a marketing information service specializing in industrial process and energy related industries with products and services ranging from industry news, forecasting, plant and project databases, as well as multimedia advertising campaign assistance.