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Rosneft offers China a stake in a future Russian petrochemical plant

10th February 2014

Rosneft gives China a stake in a future petrochemical plant in Russia's Far East to encourage cooperation

Igor Sechin revealed that Rosneft is ready to consider the Chinese as partners

Rosneft is granting China a stake in a future petrochemical plant, Vostochnaya Neftechemicheskaya (VNHK) in Russia's Far East in attempt to enhance cooperation, Reuters reported.  

Rosneft and the China National Petroleum Corporation (CNPC) agreed to work together in building a refinery in Tianjin, China that has a capacity of 13 million tonnes per year, but both companies have not yet agreed on when to begin construction.

Igor Sechin, chief executive at Rosneft revealed that "In exchange for our participation in the Tianjin refinery, we made a proposal to our Chinese partners. We are ready to consider our Chinese partners as investors in VNHK."

China has already surpassed Germany as the largest buyer of Russia's oil with pipeline shipments estimated to be around 1.949 million tonnes in January, details the Russian Energy Ministry.

In 2013, Rosneft signed a memorandum with CNPC to draw from Russian oilfields jointly, especially the Srednebotuobinsk deposit in East Siberia.

Rosneft took on oil firm TNK-BP in 2013 for $55 billion, which enabled Rosneft to increase its share of Russian oil output to more than 40 per cent.  The company now plans to become the country's second-largest gas producer after Gazprom by 2020.

Rosneft and ExxonMobil have also agreed to build a plant to liquefy natural gas in the Far East which will have a capacity of 5 million tonnes a year.

Sechin added that Rosneft may consider building another LNG plant to "monetise its offshore gas reserves," but it did not elaborate on who the partners will be as well as timing or location.

 

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