Market sources told SSESSMENTS.COM that Russian energy corporation Gazprom and its partners have decided to proceed with the multibillion-dollar, export-oriented gas-chemical project. The project will be built in Ust Luga, near St Petersburg, Russia, where Gazprom will construct the upstream natural gas processing and liquefaction facility.
The facility is the central piece of the project to transform the region into a major gas processing and chemical hub. As SSESSMENTS.COM noted, the facility will have an annual processing capacity of 45 billion cubic meters of natural gas and can produce up to 13 million tons of LNG, 3.8 million tons of ethane, 2.4 million tons of LPG, and 200,000 tons of pentane-hexane fraction.
The ethane output will be fed to two crackers with an individual capacity of 1.4 million tons/year of ethylene. The site’s downstream polyethylene capacity is aimed to reach 3 million tons/year. It will also house units to produce 10,000 tons/year of butene-1, 75,000 tons/year of hexene-1, and 274,000 tons/year of linear alpha-olefins (LAO).
Site clearing is underway, while project funding is being discussed with domestic and foreign credit institutions. Lummus Technology has secured a contract to provide the technology license, engineering, and process design package for the olefin production and recovery units. Meanwhile, Beijing-based CNCEC is the main FEED and an EPC contractor for the project’s crackers, PE plants, LAO units, and off-site facilities.
