Prime minister predicts a 1.2% increase in Kazakhstan’s GDP due to new polyethylene project
According to Prime Minister of Kazakhstan Olzhas Bektenov, the country’s GDP will grow by 1.2% by 2030 thanks to a polyethylene project by KazMunayGas, Russian SIBUR and Chinese SINOPEC, which has officially joined the project recently.
«The top priority for our economy is high value-added and export-oriented production. The price gap between ethane, the raw material, and polyethylene, the third-stage final product, is 20 times from $80-90 to $1,600-1,800 per ton thanks to the value-added we will create. The Polyethylene project will certainly boost the development of both the manufacturing industry in Kazakhstan and the country’s economy as a whole. According to experts, the project’s contribution to the national GDP will reach 1.2% by 2030,» Bektenov highlighted.
China Petrochemical Corporation (SINOPEC) has officially joined the project after its President Zhao Dong, CEO of SIBUR Mikhail Karisalov and Chairman of the Management Board of KazMunayGas (KMG) Magzum Mirzagaliyev signed a tripartite cooperation protocol. Currently, KMG controls 40% of the project, while SINOPEC and SIBUR have a 30% stake each. The partners plan to produce 22 types of polyethylene using technologies from Chevron Phillips and Univation; 40% of the products will be premium grade.
As Bektenov noted, the plant’s construction is scheduled to be done by 2029, although in October 2023, authorities promised to complete the construction a year earlier. The project is expected to create more than 8,000 jobs during construction and 850 jobs once the plant is commissioned. The manufacturing site will be built on the territory of a special economic zone with all necessary infrastructure and a special tax regime, the prime minister underlined. He also added that in addition to the Polyethylene plant, a gas separation complex and a main pipeline must be built under the project.
On April 18, the media reported that Samruk-Kazyna Ondeu, a subsidiary of the Samruk Kazyna holding, sold a 40% stake in Kazakhstan Petrochemical Industries (KPI), a joint polypropylene project, to SIBUR. Leonid Mikhelson and Gennady Timchenko, Russian moguls targeted by Western sanctions, are two major shareholders of the holding.
