Sonatrach proceeds with US$1.4 bn Turkish petrochemical complex
Algerian state oil/gas firm Sonatrach has through its subsidiary SPIC (Sonatrach Petrolium Investment Corp.) and Turkish company CPEY, a subsidiary of Ronesans, signed in Istanbul all the contracts needed to launch engineering studies for the petrochemical complex for the production of propylene and polypropylene (PDH-PP) in Ceyhan, Turkey. According to Sonatrch, the investment of this project is estimated at about US$1.4 billion.
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The signing ceremony was attended by Minister of Energy Mohamed Arkab, Turkish Minister of Industry and Technology, Turkish Minister of Energy and Natural Resources, as well as the P-DG of SONATRACH, Rachid Hachichi and Ronesans CEO, Erman Ilicak, said a statement from the National Hydrocarbons Company.
Also present were directors from the project company, the contractor FEED GS (South Korea), the board PMC ISS (Italy), the licensor UOPL (UK), the licensor Lyondel Basell (Italy), as well as the Turkish local authorities, added the same source.
“This event represents the culmination of two years of continuous work by teams from both sides,” said the statement, adding that Sonatrach and Ronesans had, on August 19, 2019, created the project company, a joint venture under Turkish law, with a shareholding structure of 34% for SPIC and 66% for CPEY.
The purpose of this project company is, according to the same source, the design, engineering, supply, construction and operation of a production complex of 450,000 tonnes/year of PP at the industrial zone level. of Ceyhan, dedicated to the development of petrochemicals.
Sonatrach and Ronesans have “diligently deployed all the necessary efforts to ensure the success of this project, particularly with regard to the property tax base allocated to the industrial zone, supply of the raw material + propane + to the project provided by Sonatrach to the project. horizon 2040, tax benefits granted to the project by two decrees signed by the Turkish President, Recep Tayyip Erdogan,” said a statement.
This project represents a “strategic interest” for Turkey as for Algeria. For Turkey, because this project will make it the world’s first petrochemical unit and is considered a precursor for the development of petrochemicals in this country.
In addition, the project will meet a significant demand for petrochemicals in the region and seize the opportunity of a potential PP market of more than 2 million tonnes/year, located at a 100 km from the project site. said the statement.
This project will also enable Sonatrach to secure a long-term outlet for Algerian propane up to 2040 for a quantity of 540,000 tonnes/year.