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EuroChem and ChemChina in Russian Project

Major fertilizer company EuroChem has signed a Memorandum of Intent with ChemChina for a potential joint petrochemical project in Russia. The companies are looking at the feasibility of building plants to produce propylene oxide, propylene glycol and polyols, and the isocyanates MDI/TDI, using technology provided by ChemChina.

If it goes ahead, the complex will be built at EuroChem’s Novomoskovskiy Azot plant in Russia’s Tula region, where it will be integrated downstream of existing production. Output would be primarily sold on the domestic market to meet growing internal demand.

EuroChem’s CEO, Dmitry Strezhnev, said the plants would be Russia’s first production of propylene oxide and MDI/TDI and would end the country’s reliance on imports. Both Russia and the CIS currently rely on imports from Benelux, Germany, the US and Japan.

Preliminary estimates put investment costs at $500 million. The partners hope the project might also attract other potential investors, with the prospect of additional financing from Russia and China. EuroChem has also signed a Memorandum of Understanding with the Russian federal and Tula regional authorities to conclude a trilateral investment contract in support of the project.

In separate news, EuroChem and joint venture partner H.K. Miago have signed a declaration of intent with Yunnan Tobacco and the Qujing local authorities in Yunnan province, China, to produce and sell fertilizers in the country. The signatories will explore the possibility of building a second 80,000 t/y potassium nitrate production line at EuroChem Migao’s joint facility in Luliang, Yunnan. An additional plant to produce water-soluble NPK fertilizers could also be built. Current production at Luliang is 100,000 t/y NPK and 70,000 t/y of potassium nitrate.