Meeting of TAIF JSC Leadership and CC7 Chairman Long Haiyang of China Held in Kazan
The possible participation of the leading Chinese engineering company in the field of petrochemicals and petroleum refining – China National Chemical Engineering & Construction Corporation Seven, Ltd (CC7) in the implementation of two development projects of the TAIF group has was discussed at a recent meeting in Kazan. CC7 Chairman Long Haiyang paid a working visit to TAIF JSC head office, where he met the management of the parent company of TAIF group. Read the details in Realnoe Vremya’s material.
This is not the first visit to the head office of the parent company of TAIF group for Mr. Long Haiyang. He was here when China National Chemical Engineering Group Corporation Ltd. (CNCEC) – one of the largest EPC contractors in the petrochemical industry and the parent company of the holding company, which includes CC7, was working in Tatarstan (Mendeleyevsk) on the implementation of the construction project of the ammonia complex. The project was implemented under the personal supervision of the President of Tatarstan, Rustam Minnikhanov, and is now operating successfully.
Already then, the two groups were studying each other’s capacities and prospects for cooperation. Now they’ve returned to the dialogue that had been interrupted for some time. The meeting was also attended by Ramil Mavlyutov, Managing Director of Tatarstan Trade House (Turkey) and Tatarstan Trading House PLC (Iran).
On behalf of TAIF JSC and the Group as a whole, the meeting was chaired by Albert Shigabutdinov, Chairman of the Board, Senior Development Advisor to the CEO of TAIF. The negotiations were also attended by the Director General of TAIF JSC Ruslan Shigabutdinov and others.
During the presentation of the parties, the guest felt it necessary to inform that in Chinese, his name – “long”, means “Dragon”. Then an interesting point was found: it turned out that there were three dragons at the negotiating table at once: the symbol of the years in which Albert Shigabutdinov and Ruslan Shigabutdinov were born is also the dragon.
СС7: 12 years in Russia
The staff is around 8,000 specialists, 4 projects implemented and 4 others – ongoing. Among the Russian customers of Chinese services CC7, besides the ammonia chemical complex in Mendeleyevsk – ZapSibNeftekhim of Sibur, the Afipka refinery, the Omsk oil refinery, the Omsk lubricants plant, the unit of Lukoil’s Kstovo delayed coking, RusGasDobycha Baltic gas chemical complex and a number of other companies. Work experience in Russia deserves attention and respect. Therefore, TAIF responded to the offer to meet and showed willingness to discuss possible cooperation. In addition, there are specific projects that the Tatarstan Group wishes to implement and expects profitable offers from potential entrepreneurs.
“There are two projects that might interest you. The first project concerns the production of carbon black. The planned capacity of the plant is 216,000 tonnes per year for raw materials. And we have the raw material for this production. The best in the world: pyrolysis resin resulting from the pyrolysis of naphtha from ethylene production units or pyrolysis. But we can consider the possibility of using other raw materials. We have information that you – in the People’s Republic of China – have a powerful center for the development and production of carbon black.
The second project is the production of methanol with a production capacity of 500,000 tonnes per year. In the future, we will use the products of this production as raw materials for the production of synthetic rubbers. You have experience in the implementation of such projects. The successful implementation of these projects will form a good basis for our future cooperation. The TAIF Group’s strategic development program has been drawn up in detail and adopted until 2030. The total cost of projects already implemented and planned amounts to more than 20 billion dollars. There is a lot of work to be done, and the partner-entrepreneurs who have proven their reliability and demonstrated their willingness to work quickly and efficiently, are valuable and important to TAIF ”, Albert Shigabutdinov very frankly stated the wishes of TAIF.
We are ready not only to build but also to invest
Mr. Long Haiyang arrived perfectly prepared for the meeting with the management of TAIF. In particular, he expressed the willingness of the Chinese side to take on all aspects of the project: acquiring a license for the technology, developing a basic and functional project, obtaining all approvals. and necessary permits, organizing the purchase of equipment, and completing the turnkey construction, calling, if necessary, on the expertise and services of other companies belonging to the CNCEC holding.
CC7 also expressed another proposition:
“We can offer the following option: if the TAIF Group considers such an opportunity, we can jointly invest in certain projects. We have a fairly flexible cooperation system, ”said Mr. Long Haiyang.
“For the carbon black plant construction project, we are prepared to consider the possibility of attracting co-investor funds in the range of 15% to 49%. We intend to use the products of this production for our capabilities – the manufacture of rubber products (in particular, for a complex offer to the world’s leading tire manufacturers – Editor’s Note). This is during the implementation of the first step. Then the second stage – the production of the most marginal types of carbon black for paints, computers, etc. », Declared Albert Shigabutdinov. These types of products, among others, can be supplied to the Chinese market.
As for the production of methanol, its products will be fully involved in the production of synthetic rubbers of the Group itself, and the possibility of a participation in the capital in the implementation of this project by TAIF is not envisaged.
Prior to meeting with the management of TAIF JSC, Mr. Long Haiyang had worked on this issue in detail with major financial institutions in China.
Two leading banks in China, according to Mr. Long Haiyang: Bank of China Limited and Industrial and Commercial Bank of China (ICBC) have declared their willingness to extend lines of credit for up to 15 years and on terms of 15% of funds come from the construction customer, 85% – credit funds. CC7 is also ready to actively participate in the discussion of line of credit volume and interest rate, if necessary. One of the key conditions of the TAIF Group in terms of attracting borrowed funds is the involvement of international export credit agencies.
Deadline – until September
During the negotiations, the parties agreed to exchange the necessary information: CC7 will receive specific technical specifications for the two projects, and the TAIF group will have the opportunity to learn about the main points of the projects already implemented by the company. Chinese. By mid-summer, Tatarstan expects a detailed technical and commercial offer and, if the parties agree, they will likely start preparing the contract to be signed by early September.
If necessary, the company is ready to involve up to 50,000 professionals from partner companies with which it has built solid professional relationships for a long time. In 2019, in the Kstovo and Omsk facilities alone, nearly 8,000 people worked for the Chinese company at the same time. Plus other items.
Everyone leaving China is already vaccinated against COVID-19
“Will there be issues with worker involvement, given COVID-19? »Ruslan Shigabutdinov, Managing Director of TAIF JSC, asked one of the most relevant questions for today.
“We have not been affected by the pandemic,” Mr. Long Haiyang said immediately. He continued: “All employees of the company who have come to Russia since August last year are vaccinated. Including myself. In a few days, 6 charters will be arriving in Russia and there. facility which is being built by CC7 for GazpromNeft as well as in Kstovo for Lukoil. All arrivals are also vaccinated with one of the 5 state-approved vaccines in China. Now in China there are such requirements: everything the world traveling outside the country must be vaccinated. The government of the country has high demands for the safety and health of its citizens.
About 300 people, who were working on Russian territory before the pandemic and did not have time to leave before the epidemic cut off air traffic between the states, were vaccinated here in Russia, the government also said. president of CC7.
After discussing the main issues, the parties exchanged gifts and agreed to new meetings as soon as they were ready. The next one could take place as early as mid-summer, when the Chinese company will complete the development of commercial offers for the two projects.
By Arsène Favstritsky
TAIF JSC is the parent company of the TAIF Group. TAIF JSC was founded in August 1995 on the basis of the Kazan Foreign Trade Research and Production Association (founded in 1990).
TAIF Group includes the TAIF JSC Group, comprising 29 subsidiaries, and the TAIF Management Company JSC Group, comprising 11 subsidiaries. TAIF Group operates in many fields, the main ones being oil and gas processing, chemicals and petrochemicals, energy engineering, investment, building materials, media and other types of services. . The total number of TAIF Group employees is 39,700 people.
China National Chemical Engineering & Construction Corporation Seven, Ltd (СС7) is headquartered in Chengdu, Sichuan province.
CC7 is a subsidiary of China National Chemical Engineering Group Co., Ltd. (CNCEC), a large group of engineering and construction companies supervised by the Commission for Supervision and Administration of Assets Owned by the State Council of the RPC. The CNCEC is among the top 250 contractors in the world according to the US Engineering News Record and second in the global ranking of engineering and construction companies in the oil and gas industry.
CC7 is 11th on the list of the 100 largest international entrepreneurs and 1st in the petrochemical industry in a ranking published by the Ministry of Commerce of the PRC. The company has been present in Russia for more than 12 years, including eight large petrochemical projects, both of which have already been implemented and are ongoing.