Irkutsk Oil Company and China Pingmei Shenma Energy Chemical Group Signed an Agreement on Joint Gas Processing Project

On July 17 Irkutsk Oil Company (INK) represented by Deputy General Director Mr. Dmitry Levin and China Pingmei Shenma Energy Chemical Group Co., Ltd represented by its Chairman Liang Tesheng signed an agreement on the joint gas processing project. Signing ceremeny took place in Moscow. The document calls for construction of natural gas and associated petroleum gas processing facilities.

The parties agreed to establish a joint venture for developing perspective gas processing projects. The company will be registered in Irkutsk region by end of the year. Currently Russian and Chinese research institutes are doing a feasibility studies. The facilities will use equipment made in both Russia and China.

Chairman of the Board of Directors of Irkutsk Oil Company Mr. Nikolay Buynov mentioned that new joint venture will contribute to economic cooperation between Russia and China. The partnership allows to increase non-resource export according to the “National goals and strategic tasks for the development of the Russian Federation up to 2024” and develop of Chinese global initiative «One Belt - One Road».

China Pingmei Shenma Energy Chemical Group Co., Ltd is a large-sized innovative enterprise operating in China in coal production and processing. The annual revenues of the group reached 23 billion USD last year. The coal production capacity of the Group is the largest in China and the production capacity of nylon ranks it the first in Asia.

INK holds a group of companies (INK Group) conducting geological study, exploration and production of hydrocarbons in 41 license blocks in East Siberia including Irkutsk region, Yakutia (Republic of Sakha) and Krasnoyarsk region. INK invested more than 200 billion rubles into infrastructure and field development since its foundation in 2000. Within the last seven years, INK has demonstrated 7-fold growth of its production, last year, produced 8.5 million tons of oil and condensate.

In 2013, INK commenced implementation of the large-scale project of gas reserves development in the northern areas of Irkutsk region. The project, estimated at 361 billion rubles, has three stages, two of which are partly implemented including the construction of gas processing plants, pipeline for transporting gas processed products, an uploading terminal in Ust-Kut for receiving, storing, and shipping liquefied petroleum gas. The third stage provides the construction of gas deep processing facilities near Ust-Kut.