China Petroleum & Chemical Corp. (Sinopec) and INEOS Group have signed a joint-venture agreement under which the companies will partner on Sinopec’s grassroots 1.2-million tonne/year (tpy) ethane cracker complex currently under construction in Tianjin Province, China.
As part of the Dec. 7 agreement, Sinopec and INEOS will each hold a 50% ownership interest in the Tianjin Nangang Ethlene Project (TNEP) that, in addition to the new ethane cracker, will house 12 other downstream derivatives plants, including a 300,000-tpy acrylonitrile butadiene styrene (ABS) and 500,000-tpy high-density polyethylene plant (HDPE), both of which will based on INEOS’ proprietary Terluran ABS technology, INEOS said.
Sinopec and INEOS said they expect to commission TNEP’s ethane cracker as well as its ABS and HDPE plants by yearend 2023.
Formation of TNEP partnership marks the fourth 50-50 JV agreement between Sinopec and INEOS in 2022 following previous agreements signed in July, when the companies confirmed they would collaborate on three JV projects worth an estimated $7 billion and involving a combined 7 million tpy of both existing and future petrochemical production in China as part of growing partnership aimed at helping the country meet rising demand in its domestic market (OGJ Online, July 28, 2022).
As part of one deal, INEOS agreed to acquire 50% of Sinopec subsidiary SECCO Petrochemical Co. Ltd., which produces 4.2 million tpy of olefins, polymers, and other derivatives—including ethylene, propylene, polyethylene, polypropylene, styrene, polystyrene, acrylonitrile, butadiene, benzene, and toluene—across a series of plants at its 200-hectare complex inside the Shanghai Chemical Industry Park, a 29.4-sq km national professional development zone specializing in petrochemicals situated at North Shore, Hangzhou Bay.
Under a second agreement, INEOS and Sinopec will form a new but yet-to-be-named 50-50 JV to focus on increasing China’s production capacity of ABS by up to 1.2 million tpy via construction of two new Terluran-based 300,000-tpy ABS plants—one at TNEP, and the second at a location to be later decided.
The planned ABS JV will also become responsible for operation of INEOS Styrolution Group GmbH’s 600,000-tpy ABS plant currently under construction in Ningbo upon the site’s scheduled commissioning by yearend 2023, according to the companies.
Under a final agreement, INEOS and Sinopec propose establishing a third JV that will oversee construction and operation of TNEP’s 500,000-tpy HDPE plant in Tianjin by yearend 2023, as well as at least two additional HDPE plants in China sometime in the future.
Still subject to regulatory approvals and other conditions, the recently formed JVs come as part of the two companies’ strategy of meeting increased demand for petrochemicals as well as their dual goals of reducing carbon emissions and managing the energy transition within their respective businesses, from refining all the way through petrochemicals, according to Dr. Ma Yongsheng, Sinopec’s chairman.
