Sibur and Saudi Aramco in Rubber Talks

08.03.2018 -

Russian petrochemical giant Sibur is in talks with Saudi Aramco to set up a joint venture to produce synthetic rubber, according to media reports. The companies signed a cooperation memorandum during Saudi King Salman’s visit to Russia last October, but details on specific projects have not emerged to date.

Sibur's CEO Dmitry Konov said the company possesses synthetic rubber technology but there is little feedstock availability in Russia along with low domestic demand growth. He added that Saudi Arabia’s good feedstock availability and growing Asian markets could make the project attractive.

The Russian group already has a rubber joint venture with India’s Reliance Industries. The two signed a Memorandum of Understanding (MoU) in January 2017 to build the first halogenated butyl rubber plant in south Asia. A 60,000 t/y plant is being built at Reliance’s site in Jamnagar, Gujarat, with production expected to start in late 2018.

However, a joint venture signed in May 2014 between Sibur and China’s Sinopec to build a 50,000 t/y butadiene nitrile rubber plant in Shanghai is reported to be on hold. Konov told online chemical news service ICIS that the project has been mothballed but could be revived if market demand develops to justify the investment.

Saudi Aramco also has an existing synthetic rubber joint venture with Lanxess, trading as Arlanxeo. However, Konov said there are gaps in Arlanxeo’s portfolio.

In separate news, Sibur’s ZapSibNeftekhim complex in Tobolsk, Russia, is reported to be completed in the second quarter of 2019, six months earlier than originally planned. The facility, which will triple Sibur’s polymers capacity, will add 2 million t/y of polymer – 1.5 million t/y of PE and 500,000 t/y of PP.