Far East Petrochemical Company (FEPCO) Project, Nakhodka, Russia

FEPCO Project, Russia

Far East Petrochemical Company (FEPCO), a subsidiary of Rosneft, formerly known as Vostochnaya Neftechemicheskaya Company (VNHK), is developing a new petrochemical and crude oil refining project within the Primorsk Region, near the Pervostroyiteley village of the Nakhodka City District, Russia.

The project was conceptualised in late 2010 and VNHK was formed in 2011 to implement the project. The technology licensors for the project were selected in late 2011. FEPCO signed a memorandum of understanding (MoU) with Mitsui in April 2013 to jointly develop the project.

"The site was chosen due to its proximity to the South-East Asian markets and presence of a sea terminal near Vostochny port."

Approximately RUR2.4bn (approximately $48m) was invested in the project in 2013. The Russian petrochemical project is expected to generate approximately 100,000 jobs. It will also generate approximately RUR1trillion (approximately $20bn) in revenues by 2030.

The site was chosen due to its proximity to the South-East Asian markets and presence of a sea terminal near Vostochny port. Products from the complex will primarily cater to markets in the Russian Far East and countries in South-East Asia.

FEPCO project details

The complex was initially conceptualised with a throughput capacity of ten million tonnes per annum (mtpa) but was later increased to 30mtpa. The project is being executed in three phases.

Expected to be completed by 2020, Phase I will involve the installation of crude oil refining facilities with a throughput capacity of 12mtpa.

Phase II will involve the installation of petrochemical facilities with a throughput capacity of 3.4mtpa. Scheduled for completion in 2028, Phase III will further increase the crude oil refining capacity by 12mtpa and petrochemical capacity by an additional 3.4mtpa.

Al Sejeel Petrochemical Complex is under construction at Ras Laffan Industrial City, about 70km north of Doha.

The complex will produce 1.4mtpa of ethylene, 600,000t per annum of propylene, 230,000t per annum of benzene, approximately 200,000t per annum of butadiene in the first two phases, making it the world's biggest steam cracker by volume and 50,000t per annum of linear alpha-olefins.

Majority of the required feedstock will be sourced primarily from Rosneft's Achinsk and Komsomolsk refineries while the rest will be supplied by Angarsk Petrochemical Company.

Technologies and licensors for the Russian petrochemical plant

Ineos Technologies is licensing its proprietary Innovene G, Innovene S and Innovene PP processes for the project. The linear alpha-olefins unit will implement Axens' proprietary AlphaButol and AlphaHexol technologies.

Lummus Technology has licensed its proprietary Lummus SRT-VII heater technology for the steam cracking unit.

Contractors involved with the FEPCO project

The technical advisor for the project is KBR, whereas the financial advisor is Renaissance Capital. The front end engineering and design (FEED) study for the steam cracking unit was performed by Toyo Engineering in 2012.

The project design documentation for the facilities of the petrochemical complex was performed by OMSKNEFTEKHIMPROEKT (ONHP). The fire protection systems are being designed by Pozhengineering.

Rosneft signed an MoU with Pirelli in October 2014 for research and development, production and shipping of synthetic RURber from the project. The two companies further signed a MoU with Synthos in April 2015 for the latter to serve as their technology partner.

FEPCO signed an agreement with the Far Eastern branch of Russian Academy of Sciences (FEBRAS) in July 2014 for scientific and technical collaboration in the project. This agreement, valid until 2022, will provide ecological security during the implementation of the project and benefit the oil refining and petrochemical industry through a number of research and technical developments.