OREANDA-NEWS.  Sibur and Rail Garant, a Russian freight transportation group, have signed an agreement under which Sibur’s fleet of liquefied petroleum gas (LPG) rail cars will be sold to Rail Garant. The 11.5 billion Russian ruble (USD 350.2 million) deal is expected to close following all the necessary approvals, including regulatory approvals. The LPG rail car fleet owned by Sibur includes 4,364 tank cars.

Following the transaction the entire fleet will be operated by Sibur-Trans, Sibur’s freight operator. Half of the fleet will be leased, and the other half may be used by Sibur-Trans for product transportation under a service contract. The contracts are valid for six years, allowing Sibur to transport required volumes of its own products while generating return on investments made earlier into the rail car fleet. Sibur-Trans will continue its operations within the Sibur group to ensure reliable transportation of the company's products and help develop non-public railway tracks.

Sibur-Trans transport fleet currently has 13,113 LPG tank cars at its disposal, including 4,364 tank cars in ownership and 8,749 tank cars on lease or in operation. Additionally, Sibur-Trans either owns or operates 3,870 tank cars for petrochemical products, 2,013 LPG tank containers, 386 tank containers for liquid cargo, and 16 all-purpose cars. Sibur-Trans also operates public railway tracks with a combined length of 330 km.

The transaction will enable the Rail Garant Group to become a major player at the growing LPG transportation market and will guarantee full utilization of the fleet in spite of prevailing surplus of rail cars on the market. The LPG transport fleet currently operated by Rail Garant comprises 1,500 tank cars and 1,608 tank containers. The group also operates 6,132 tank cars for crude oil and gasoline and 1,953 tank containers for liquid chemicals. Rail Garant is one of the leading transporters of industrial goods on the Russian railway market. Its shareholders are Sergey Smyslov and Sergey Guschin.