Rosneft and China National Chemical Corporation (ChemChina) signed on the sidelines of the negotiations between the President of the Russian Federation Vladimir Putin and the President of the People's Republic of China Xi Jinping the Agreement setting out the framework for further implementation of the Far-Eastern petrochemical company (FEPCO) project and the establishment of a joint venture (JV). The document was signed by Rosneft Chief Executive Officer Igor Sechin and ChemChina President Ren Jianxin.
The agreement confirms the intent of the parties to further implement the FEPCO project and create a JV. The document defines the composition of the JV – Rosneft will hold 60%, whilst ChemChina will obtain 40%. The financial and operational structure of the JV will be defined by the parties within further negotiations.
The signed document also specifies the timetable for Front End Engineering and Design (FEED) and start of site infrastructure preparation, outlines the milestones in project execution, and on a broader basis confirms the project roadmap for FEPCO project delivery.
Commenting on the signed document, Igor Sechin said: “This agreement with ChemChina is a clear reflection of the scale of cooperation between the leaders of the Russian and Chinese energy industry. The FEPCO project marks a new level of energy related partnership between the countries and it will further strengthen the economic ties between Russia and China. The formation of the JV will allow us to efficiently structure the development of one of the most promising petrochemical projects in the world with direct access to the Asian-Pacific market. Together with our Chinese partners we will enable FEPCO products to obtain significant marketing potential in a highly competitive region”.
ChemChina President Ren Jianxin said: “Rosneft is an important partner of ChemChina. We keep a good track record of comprehensive cooperation. The signed agreement is of great significance for both parties to further implement the FEPCO project and deepen comprehensive cooperation. FEPCO project is positioned to provide high value-added chemical products covering Asian-Pacific markets. It will also strongly facilitate the development of infrastructure in Far East region.
