OREANDA-NEWS. Russian Prime Minister Dmitry Medvedev held a meeting on the development of the chemical and petrochemical industries. The attendees of the meeting included Deputy Prime Minister, Arkady Dvorkovich, Alexander Novak, the Minister of Energy, Mikhail Babich, the Presidential Plenipotentiary Envoy to the Volga Federal District, Rustem Khamitov, President of Bashkortostan, Alexander Dyukov, Deputy Chairman of SIBUR Holding's Board of Directors and CEO of Gazprom Neft, Dmitry Konov, CEO of SIBUR, heads of major petrochemical and oil and gas companies, and other officials.

The meeting was held at the POLIEF production site, one of Russia's largest polyester complexes producing feedstock for the manufacture of plastic bottles for food products.

Dmitry Medvedev inspected the POLIEF production site, which is currently expanding its polyethylene terephthalate (PET)capacities. PET is used to produce food and pharmaceutical packaging, and film. POLIEF's current terephthalic acid (feedstock for PET production) output is 250,000 tonnes per annum, and PET output - 140,000 tonnes per annum. With the expansion of the polyester facility, PET capacities are expected to reach up to 210,000 tonnes per annum.

This project will allow POLIEF to process its own terephthalic acid into high value-added products and to replace imports in some Russian PET market segments. Despite current tightening of spreads between feedstock and finished product prices in the global PET market, the Russian market has substantial growth potential. In 2012, Russia produced about 453,000 tonnes of PET and imported 185,000 tonnes[i]. The current consumption rate per capita of food-grade PET in Russia is 4.1 kg compared with 9.5 kg in the US.

The project is included in the list of priority projects of Bashkortostan. Today, 100% of the production equipment has been installed, and 50% of the construction work has been finished. Commercial operations are scheduled to begin in 1H2014.

POLIEF's PET fully meets the Russian and international quality standards for food contact materials. The Pira International Certificate of Conformity authorises POLIEF to sell its products in the European market.

The Russian Prime Minister also had a look at the KhimTerra Industrial Park Project. This Project, which is being led by the Bashkortostan Development Corporation, aims to support small and medium-sized businesses and to set up new production facilities that will use POLIEF products. The opening of this Industrial Park will help boost economic growth in the Republic, raise tax revenues, and create new jobs.