about the novy urengoy gas and chemical

ABOUT THE NOVY URENGOY GAS AND CHEMICAL
COMPLEX CONSTRUCTION PROJECT
The Novy Urengoy Gas and Chemical Complex (NUGCC) will be situated 30 kilometers from the city of
Novy Urengoy in the Yamalo-Nenetsky Autonomous District of the Tyumen Region.
The estimated output constitutes up to 400 thousand tons of low density polyethylene (LDPE) per year
with the potential to increase output up to 1.2 million tons, up to 400 thousand tons of Y-grade NGLs, and
up to 1.48 billion cubic meters of methane fraction per year. The investor is Gazprom, and the project operator is Novy Urengoy Gas and Chemical Complex, LLC (a wholy-owned subsidiary of Gazprom). The General
Contractor is VIS Construction Group and the project is intended to be commissioned in 2012.
In March 2008, while advancing towards its long-term objectives to improve the efficiency of natural resource consumption and to preserve ecology in extraction regions, Gazprom approved a strategy of gas
and oil processing, which provides for the “growth of gas and chemical products manufacturing, increase in
recovery of valuable components from gas, and growth of the output of products of deeper conversion”.
3
UNIQUE LOCATION
The production facilities of the complex are situated in the Nadym-Purtazovskiy Region, where nearly 90%
of Russian natural gas presently produced extracted. The Urengoy Oil and Gas Condensate Field is located
in immediate proximity to the future complex. In accordance with the General Scheme for Development of
the Gas Industry through 2030 (currently being developed), the project aims to improve efficient natural
resource consumption and is to be based on international principals of project financing. Gazprom forecasts
increased production of natural gas with high content of ethane, propane, and butane from 90 billion cubic
meters to 160 billion cubic meters by 2020.
Associated petroleum gases and light hydrocarbon gases (ethane and, to a lesser extent, propane) created in the process of gas condensate preparation for transportation and representing unique raw materials
for production of polyolefines, as well as developed infrastructure of the region make Novy Urengoy a natural and favorable place for developing the gas chemical complex.
4
TECHNOLOGY
World class design bureaus, equipment suppliers, and builders possessing the broadest experience in the
construction of such objects were engaged for the implementation of the large-scale NUGCC strategic project. The project was developed employing advanced foreign technologies and foresees uniting production
of ethylene from natural hydrocarbon gas and further production of polyethylene in a unified process flow.
The technology of ethylene production was developed by Linde AG (Germany). The polyethylene production process was designed by Satzgitter AG (Germany). Modifications to the project, in order to increase
polyethylene output up to 400 thousand tons per year were made by Tecnimont SpA. High-pressure polyethylene will be produced under licensing from BASF (at the present time, the licensor is Basell Polyolefine
GmbH).
A distinctive feature of the complex is a simplified processing cycle, which allows for the production of
ethylene with 99.9% concentration directly from ethane and includes the following stages:
- ethane production from natural gas;
- ethylene production by means of high temperature pyrolysis reaction of ethane with the following pyrolysis gas decontamination;
- low temperature fractional separation of pyrolysis gases with extraction of ethylene;
- polyethylene production on three process lines by high pressure ethylene polymerization in a tubular
reactor using oxygen as an initiating agent.
5
PRODUCTION INFRASTRUCTURE
Since no irregularities in heat and power supplies to
the complex are acceptable, the production infrastructure entirely answers the needs of the complex with
regards to electricity, heating, and water. Required
electrical and, partially, heat energy will be generated
in a gas turbine power plant with a capacity of 120 MW
located within the production area. Heat is generated
by a boiler plant (steam and water boilers); on-site artesian wells satisfy water requirements. Depending on
the intended purpose, water passes through necessary
purifying stages and treatment at the water preparation plant.
Moreover, the production infrastructure of the complex includes: liquefied gas and Y-grade NGLs storage
facilities, propane stock, flare devices, chemical storeroom, equipment storage facilities, repair shop, control
and measuring instrument workshop, a fire station,
compressing and air drying plant with a nitro-oxygen
unit, sewage treatment facilities, waste management
department, and external infrastructure objects.
6
PRODUCT DESCRIPTION
The main sellable product of the complex is granular polyethylene produced on three parallel process
lines with an annual capacity of up to 135 thousand tons each. The plant allows producing all brand assortment of low density polyethylene in compliance with the national standard GOST 16337-77 and the European standard LUPOLEN for tubular reactors using oxygen as an initiating agent for polymerization process.
The primary purpose is the production of polyethylene film brands.
Finished products are expected to be delivered mainly by railway transport from “Ethylene” station. Covered railwagons and sea containers will be accepted and treated at the station; freight trains will be prepared for departure, rolling stock will be set for delivery to the loading and unloading area and dispatch. The
maximum number of wagons to arrive to and depart from “Ethylene” station simultaneously is forty wagons.
Railway transportation will allow delivering finished products to all regions of Russia and abroad both to end
customers and the nearest river and sea ports.
The presence of a highway allows transporting finished products by motor vehicle.
Additionally, it will be possible to ship products by river or sea from a nearby Korotchaevo port, located
only 40 km from the complex.
7
DEMAND FOR PRODUCTS
AND THEIR DISTRIBUTION
World consumption of polymers, in particular polyethylene, is growing at a rate higher than the GDP
growth. Demand is increasing most rapidly in developing Asian countries, particularly in China. Experts predict expansion of consumption up to 4-7% annually. It is expected that launching of new low density polyethylene production facilities with an annual capacity over 10 million tons per year will be required in the
next 20 years. According to forecasts, European and Asian-Pacific countries will increase imports of polyethylene, as they have not enough raw to produce it themselves. The marketing strategy is aimed at processors of granular polyethylene in Russia, CIS, Europe, and China.
Despite the fact that the rate of polyethylene consumption in Russia is considerably lower than in the rest
of the world, demand for it is growing faster than the economy of the country as a whole. Russian industry
is behind developed countries in terms of volumes of ethane being processed. Low density polyethylene is
traditionally the most commonly used type of polyethylene in Russia (representing approximately 50% of
the market).
8
PROJECT OPERATOR
Novy Urengoy Gas and Chemical Complex, LLC was registered as a legal entity on June 30, 1999. The
founder is Gazprom. NUGCC, LLC is the owner of assets required for implementing the project and is the
customer of construction works. It attracts contracting organizations and arranges financing, commissions
and launches the complex. Day-to-day management of the company is exercised by a team of highly qualified managers possessing a wealth of experience in the construction of oil and gas treatment projects. The
total number of employees of the company amounts to approximately 630 people.
9
SUPPLIERS AND CONTRACTORS
World class designers, suppliers and contractors are engaged in the implementation of the project.
Basell Polyolefin GmbH (Germany) – the largest global producer of polypropylene and polyolefine with
special properties, occupying the leading position in production of polyethylene and catalysts for polyolefine production. The world leader in developing and licensing polypropylene and polyethylene production technologies.
Linde AG (Germany) – a transnational chemical company, the largest supplier of raw hydrocarbon material cracking equipment for ethylene and propylene production. The company performs engineering development of chemical plants, construction and reconstruction of olefin, polyolefine, synthesis gas, and hydrogen
production facilities, as well as oil and gas processing plants.
Tecnimont SpA – a subsidiary of Маire Tecnimont SpA – a leading international engineering and construction company operating in the sphere of oil and gas production. The company renders a wide range
of services from feasibility studies to engineering design, technology selection and carries out projects on a
turn-key basis.
10
VIS Construction Group (Russia) – the general contractor of the construction and commissioning of the
Complex. The group of companies has been operating in the sphere of industrial and energy construction
since 2000. It includes nine large construction company members, manages extensive production capacities,
over one thousand units of equipment, and approximately eight thousand employees.
VNIPIgasdobycha (Russia) – a subsidiary of Gazprom, performs functions of the general designer and
conducts engineering surveys and R&D for construction and reconstruction of gas and oil fields, crosscountry pipelines, compressor stations, underground gas storage facilities, gas processing plants, and gas
supply networks.
ОАО VNIPIneft (Russia) – a leading design organization developing construction projects for heating,
ventilation, water supply, and sewerage systems for ethylene and polyethylene production facilities.
Stroytransgaz (Russia) – the largest Russian construction company carrying out construction and reconstruction of industrial and infrastructure objects of the fuel and power and other industries. Stroytransgaz
comprises building, engineering, industrial, oil and gas, and financial organizations.
STROYNEFTEGAZALIANS (Russia) – comprises a number of large companies specializing in the construction of objects for the oil and gas industry: cross-country and oil-field pipelines, gas pipelines, oil pumping stations, gas compressor stations, and gas and oil extraction sites.
11
ENVIRONMENT
The unique character of the Novy Urengoy Complex project consists in its unprecedented environment
safety measures. The high pressure polyethylene production technology meets the most modern environmental standards globally. Technological, emergency, and architectural measures aimed to reduce the odds
of adverse effect to environment were developed to ensure ecological safety of the complex and adjacent
territories. The project includes aspects intended for nature protection purposes: sewage treatment facilities, thermal processing and regeneration of liquid and solid wastes, as well as ecological monitoring of the
complex.
12
PROJECT IMPLEMENTATION
The construction of the complex is in currently at an advanced stage: practically all foreign-made equipment has been supplied to the site, some construction and assembly works have been completed, and all
infrastructure necessary for completion of the construction has been arranged.
The first stage, construction of main objects required for provision of water, power, transport, and an infrastructure for acceptance of cargos and performance of technological equipment inspections, is completed.
These objects include: water supply, water treatment, fire station, steam boiler with power supply objects,
gas supply objects. Thus far, forty capital construction objects have been commissioned.
13
PROJECT IMPLEMENTATION
WAREHOUSING
Equipment and materials are stored in heated warehouses with a total area of 12.6 thousand square meters and on specially prepared open grounds with a total area of 106 thousand square meters. The facilities
are equipped with crane mechanisms.
ELECTRICITY SUPPLY
Two power transmission lines (110 kW) from a regional energy company are being used. A temporary
power substation (“Stroitelnaya”) (110/10 kW) with a capacity of 2х6300 kW was built to meet electricity requirements for the construction period. A closed distribution unit for power supply to the administrative and
housing areahas been commissioned. An emergency unit-type substation of a capacity of 1600 kW has been
built for continuous power supply to first-category consumers.
WATER SUPPLY
An intake structure with three artesian wells with a capacity up to 900 cubic meters per day has been put
into operation for supplying water to objects in the first and second stages of construction. It is equipped
with a pump plant and on-site overpasses.
14
WATER TREATMENT
The complex consumes water both for technological and housing needs. Therefore, the water passes
through different purification and treatment stages. Prior to its supply to consumers, artesian water undergoes a number of stages of decontamination from ferrum and silicic acid elements. Drinking water is treated
separately. For steam preparation, water passes through deep desalination by the reverse osmosis method.
The quality of water is continuously monitored by automated analyzers and is checked in a laboratory on a
period basis. The water treatment unit includes reservoirs for crude and treated water for continuous operation of the complex and accumulation of emergency water reserves, as well as a pump station with pipelines
for transporting and distributing artesian water.
15
PROJECT IMPLEMENTATION
GAS SUPPLY
A gas reduction unit has been put into operation to provide gas for the steam boiler, the boiler of the builders’ housing settlement, and temporary heating of production buildings and structures under construction,
which are provided with heated water. The gas fuel is supplied to the unit from the “Zapolyarnoye-Urengoy”
cross-country gas pipeline.
BOILERS
The steam boiler was commissioned during the 2008-2009heating season in order to provide builders
and objects of the first stage of construction with steam and heated water. The boiler generates steam at
a pressure equal to 0.6 MPa, and its capacity constitutes 75 tons per hour. Three LOOS steam generators
(Germany) have been installed in the boiler room. A water boiler is currently under construction.
16
FIRE STATION
A fire station has been put into operation. The fire station has eight gateways: four for emergency fire
trucks and four for special machinery of the gas safety service. A tender for the fire station servicing is being
conducted for specialized service providers.
17
PROJECT IMPLEMENTATION
WASTE WATER TREATMENT FACILITIES
Waste water treatment is carried out by a “Biodisk – 1000” biological treatment unit. Waste water from
the residential and administrative objects are collected and treated up to the equivalent of a town of 1,000
people. Construction of the main objects of a sewage treatment station was started in 2009. It is designed
for residence of up to 4,500 builders for the period of construction of the complex and ensuring removal of
industrial waste. A pumping station has been constructed; interior decoration and equipment installation
are in currently progress.
INTERNAL ENGINEERING NETWORKS
The following objects have been put into operation:
• overpasses ensuring water, heat, and energy supply to objects in the first stage of construction;
• underground fire fighting ring water conduit and waste water pipelines for objects in the first stage of
construction.
MOTOR ROADS
The main access to the site is from a motor road from the “Novy Urengoy – Surgut” highway. Access and insite roads with hard surface currently in use have a total length of 13.5 km. Some sections of the roads were
reconstructed for delivery of large-sized and heavy cargos from the “Korotchaevo” river port.
18
RAILWAY TRANSPORT
Railway transportation is possible via connecting to the “Novy Urengoy-Tjumen” passage at the “Nartovaya”
station, located 4 km from NUGCC. Railway lines leading to warehouse facilities and unloading areas are also
used. The site has a Russian Federation railway address. The permitted freight traffic rate is 40 railwagons per
day, or up to 800 thousand tons per year. Rail facilities are being arranged at the “Ethylene” and “Nartovaya”
stations. Overpasses and building framework for the locomotive depot combined with railway equipment
repair shops and an area of preparation of covered wagons at the “Ethylene” station are currently being arranged. Finishing works in the buildings are also in progress.
COMMUNICATION
The construction site is equipped with permanent telephone communication lines. An automated telephone system for 500 subscribers is being installed. The telephone station is included in the single network of Gazprom, city and international networks. Mobile communications are facilitated by a cellular
station of two operators supporting international roaming. Framework and enclosing structures of the
communication center are already assembled, while interior decoration is in progress.
RESIDENTIAL AREA
The residential area accommodates up to 1,500 people. The settlement has its own boiler, canteen, baths,
and laundry. A rotators’ camp is being constructed to lodge 4,500 people by 2010.
19
PROJECT IMPLEMENTATION
The second stage of construction has been started – work at the main production facilities, infrastructure and utilities are still in progress:
ETHYLENE PRODUCTION
Landscaping is completed; large-sized column equipment has been assembled, including ethane/ethylene separation column of a weight of 250 tons and 59 meters high; piling for main machinery has been
completed; foundations are being arranged.
POLYETHYLENE PRODUCTION
Landscaping and construction work on a warehouse building for finished products are now completed:
bearing and enclosing structures and roofs have been assembled; assembly of structures for a bunker bay
has been started. Piling is completed and foundations are arranged for the main production buildings (compressor room, polymerization shop, administrative and housing building).
20
WAREHOUSES FOR CHEMICAL AGENTS, FLAMMABLE LIQUIDS, ACIDS, ALKALIS, METHANOL
A warehouse building for chemical agents and catalysts has been constructed; foundations and columns
for buildings of acid and alkalis pumping station have been set up Underground networks are installed and
ready for use. Capacity equipment is being installed.
ON-SITE ADMINISTRATIVE BUILDING
The building has been constructed; interior decoration, as well as work on the heating and ventilation systems
is currently in progress.
HEATED CAR PARKING
The building is constructed and connected to the heating water supply network, finishing works are in
progress.
21
PROJECT IMPLEMENTATION
MECHANICAL AND ELECTRIC MAINTENANCE FACILITIES
Construction of buildings for repair shopshas been completed; interior decoration and machinery assembly are in progress. Piling works for the blanking and welding shop are completed, and foundations are being
arranged.
OTHER SITES
The site for compressing and air drying plant with a nitro-oxygen unit is being prepared for piling.
Landscaping is completed and piling works have been started on the site for the tubular gas power station.
22
Novy Urengoy
Moscow
ul. Yuzhaya, 2А, Novy Urengoy,
Yamalo-Nenetskiy Autonomous District, 629300
Tel.: 8 (3494) 22-01-27
Tel.: 8 (495) 719-37-61
Fax: 8 (3494) 22-03-61
e-mail: [email protected]
Kutuzovskiy prospect, 12,
Moscow, 121248
Tel.: (499) 929-09-81
Fax: (499) 929-09-90
e-mail: [email protected]