Bashneft and SIBUR sign long-term contract for the supply of paraxylene
Bashneft and the gas processing and petrochemicals company SIBUR have signed a long-term contract for the supply of paraxylene, which is the main raw material for the production of terephthalic acid (PTA). The new contract, concluded on former principles of formula-based pricing, is a continuation of the long-lasting partnership between SIBUR and Bashneft to supply paraxylene to Polief from the aromatic hydrocarbons manufacturing complex of the Branch Bashneft-Ufaneftekhim.
In accordance with the contract, Bashneft will supply to the Polief factory of SIBUR no less than 120 Mtpy of paraxylene in the period up to and including 2036. The paraxylene value will be determined based on the international exchange quotation. The supply volumes can be increased by mutual agreement between the parties.
Bashneft, one of the largest Russian manufacturers of paraxylene, is planning to reconstruct the aromatic hydrocarbons manufacturing complex (APC) of the Branch Bashneft-Ufaneftekhim in order to increase the production volume of paraxylene to 260 Mtpy beginning in 2018.
SIBUR, as a leading paraxylene processor and the manufacturer of PTA and polyethylene terephthalate (PET), will consider the increase in consumption of paraxylene produced by Bashneft in case of the possible expansion of Polief capacities for the production of PTA.
“The reconstruction of the aromatics complex is one of the projects which are envisaged in our refining complex modernization strategy aimed at further increasing the production of high value added products," said the President of Bashneft Alexander Korsik.
“In 2014 we expanded the capacities of Polief for PET production, which allowed us to meet the market demand for quality products and helped to resolve the important issue of import substitution of PET, as there is currently a deficit in it on the Russian market. The signing of the contract will contribute to further development of technologically connected projects of SIBUR and Bashneft, aimed at the deep conversion of hydrocarbon production by-products into valuable petrochemicals," said the Chairman of the Executive Board of OJSC SIBUR Holding, Dmitry Konov.
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