McDermott Wins Follow-up Russian Cracker Contract

16.11.2020 - US engineering contractor McDermott International has been awarded a follow-up contract for the ethane cracker complex being built by China National Chemical Engineering & Construction Corporation Seven (CC7) for the Baltic Chemical Plant (BCP) in the Russian Baltic seaport of Ust-Luga.

The natural gas-fed chemical complex taking shape near the Gulf of Finland and the starting point for the now controversial North Stream 2 gas pipeline is being billed as the world’s largest ethylene integration project. It will have two ethylene cracking trains, each with an annual capacity of 1.4 million t and six polyethylene plants, each with capacity of around 480,000 t/y, along with facilities to process linear alpha olefins.

The first development phase of the project is scheduled to go on stream in 2023, the second in 2024. The ethane will come from an LNG facility to be operated by Russian gas giant Gazprom and RusGasDobycha. This will generate around 4 million t/y of ethane during the processing and liquefaction of gas.

In 2019, McDermott received the nod to provide extended basic engineering for the plant. The follow-up award pertains to provision of the engineering and procurement early works package for all schedule-critical equipment. This will be executed from the contractor’s offices in The Hague, the Netherlands, and in Brno, Czech Republic.

"The expansion of this award is a direct result of our execution performance to date and we will continue to drive excellent results to support CC7 and BCP in the development of this world-class project," said Tareq Kawash, senior vice president, Europe, Middle East and Africa at McDermott. From concept design to commissioning and start-up, he added, the company is “uniquely positioned to execute fully integrated ethylene projects.”

Former McDermott subsidiary Lummus Technology – sold at the beginning of this year to a partnership of US private equity investor The Chatterjee Group and private equity firm Rhone Group for $2.75 billion – was previously tapped to provide the process design package engineering contract for the project, as well as the license for its olefin production and recovery technology.

Following the divestment, McDermott and Lummus work jointly on projects through a strategic agreement that leverages their respective strengths for customers.

Author: Dede Williams, Freelance Journalist