Ruslan Shigabutdinov: 'There are petrochemical producers and market in Russia, but there are not enough refiners'

Offline and online forum

Representatives of the petrochemical, oil refining, energy, and related industries from almost two dozen countries of the world again gathered near Kazan at the traditional Tatarstan Petrochemical Forum. The format tested in 2020 turned out to be in demand again, and those who, due to the ongoing coronavirus pandemic, for one reason or another could not come to the republic in person, joined online representatives of more than 150 companies from Russia and the world, who opened their expositions on the sites of the Kazan Expo International Exhibition Centre.

The forum, which started on August 31, promised its participants a rich three-day programme.

“We have a great need to organise such meetings. Always a huge number of our partners find the time and opportunity to take part. More than 150 companies are participating. There will be a lot of interesting topics that are related to new challenges. I believe that the forum itself and round table discussions are useful and interesting," Tatarstan President Rustam Minnikhanov stressed opening the event.

Minister of Economy of Kazakhstan Nurlan Nogaev, who specially arrived in the republic, on behalf of the government of the country, welcomed the participants of the forum and thanked them for the invitation. Tatarstan and Kazakhstan have long-standing business relations. By the results of 2020, the total trade turnover between the republics exceeded 630 million US dollars. Not only the volume of mutual supplies is growing, but also the number of joint projects. In particular, TAIF Group has also recently discussed the possibility of cooperation with the leader of the construction industry of Kazakhstan — the investment and construction holding BI Group.

“I am sure that within the framework of the forum we will have the opportunity to discuss current issues, prospects for the development of a very important topic for each country and for each participant of the forum — petrochemical industry," said Nurlan Nogaev.

“This platform has gathered the largest representatives of the fuel and energy complex, mechanical engineering, and science for many years. The most pressing issues of development of the oil and gas, chemical industries, digitalisation, import substitution are discussed here," Mikhail Ivanov, the deputy minister of industry and trade of Russia, stressed in his greeting to the forum participants.

“The Petrochemical Forum in Kazan is always a review. The review of our victories, a review, probably, of the reserves that we have," said Gennady Shmal, the president of the Union of Oil and Gas Producers of Russia, from the stage.

Traditionally, the forum opens with summing up the results of the competition for the best exhibit, project or technical solution. The winners of the Grand Prix received the well-deserved award from the hands of President of Tatarstan Rustam Minnikhanov. This year, two companies of TAIF Group at once have been awarded, and both — in the nomination 'New Products': Kazanorgsintez PJSC received the Grand Prix for PC-008UL1 polycarbonate.

Nizhnekamskneftekhim PJSC received its award — first degree diploma for the styrene-butadiene-styrene block copolymer of the SBS 330L brand.

Exhibition of achievements

In 2021, the Tatarstan Petrochemical Forum united four major industry exhibitions of the country at once: 28th International Specialised Exhibition 'Oil, Gas. Petrochemistry', 15th Specialised Exhibition 'Ecotechnologies and Equipment of 21st century', 11th specialised exhibition 'Geo-Kazan: Geological Exploration. Geodesy. Cartography', and 7th International Specialised Exhibition 'Interplastics. Kazan'. The huge exhibition hall of the second pavilion of Kazan Expo IEC turned into a parade of achievements of domestic and world technologies, products and equipment for several days.

The president of Tatarstan, accompanied by heads of ministries and departments of the republic, guests from the federal centre, Republic of Kazakhstan and Republic of Belarus, was one of the first to visit the stand of TAIF Group.

Nizhnekamskneftekhim PJSC: several new products every year

“Nizhnekamskneftekhim PJSC is the largest petrochemical enterprise in Russia and Eastern Europe. We produce more than 2,5 million tonnes of commercial products a year. The main thing is rubbers and plastics. Today, Nizhnekamskneftekhim produces the entire range of rubbers for modern tyres," Ayrat Safin, the director general of Nizhnekamskneftekhim, presented the complex.

In confirmation of his words, there is a stand where it is clearly demonstrated that almost every layer of modern automobile tyre uses products of Nizhnekamskneftekhim PJSC.

“To date, all five of the largest tire companies in the world have signed five-year contracts with us. This confirms our quality and reliability as a good supplier," Safin shared.

At the same time, the complex annually creates several new types of rubbers. This year, there are four new products at once. In particular, the production of divinyl-styrene rubbers with a capacity of 50,000 tonnes a year was put into operation. The fifth generation rubber is intended for the production of so-called green, that is, eco-friendly tyres. Now it is undergoing homologation from the world's leading tyre manufacturers, and the first positive reviews have already been received.

The SBS 330L thermoplastics, for which the company received the Grand Prix, are used for the modification of bitumen.

“The new product is in demand among manufacturers of road pavement — it improves the quality of road bitumen and helps to increase the service life of surface. Polymer granules are also used in the production of roofing materials.

He also said that in 2021 the development of lithium polybutadiene of SKD-777 brand on an industrial scale began. SKD-777 is used in the formulation of tread rubber compounds in the production of passenger and light truck tyres of summer and all-season range," said Ayrat Safin. Another new product — high-molecular oxyethylated product N-PEG-2400 — is intended for the production of superplasticisers of concrete mixes of the fifth generation. It allows concrete to be stored longer before use, and it increases the strength of the material when poured.

“The fact that three of the five new products relate to the field of construction and road construction indicates that the sphere is developing," said Ayrat Safin. “Another thing is depressing: the potential of domestic materials is not fully disclosed. We want to show that the level of involvement of these products in Europe is many times higher than in our country. Now it is very fashionable to use energy-saving technologies. The use of these products is an opportunity to keep up with the times. This is the future. The products that are required for this are already being produced there. It just needs to be used. It is necessary to take global trends and implement them on the territory of Russia. We are ready to give everything necessary for this," he expressed his opinion.

Bullets in polycarbonate at the stand of Kazanorgsintez PJSC

Kazanorgsintez PJSC this time focused on the modernisation of the production of polycarbonates. By the way, the company is the only manufacturer in Russia of a wide range of this extremely popular and necessary raw materials.

“The initial licensed capacity of polycarbonate production was 65,000 tonnes a year. We have brought it to 77,000 tonnes. Then it became possible to modernise this capacity with an increase to 100,000 tonnes a year. We have been doing this since 2018. This year we are to reach 100,000 tonnes. The payback period for this project is approximately 3,5 months. The product is quite marginal. Even I would say — high-margin. Our expenses amounted to about $50 million," explained Farid Minigulov, the CEO of Kazanorgsintez.

The increase in production volumes by almost a quarter will allow increasing both the production of already established brands of polycarbonates and to establish deliveries to consumers in industrial volumes of new types of products, for example, the brand PC-008UL1, for which the company won the Grand Prix on the first day of the forum. Raw materials — own bisphenol and own carbon dioxide. More than 20,000 tonnes of the latter are obtained annually from the exhaust flue gases of the production. Thus, two tasks are solved at once: production receives material for further work, and the company as a whole significantly reduces the load on the environment.

One of the exhibits of the stand attracted the special attention of the participants of the tour. In three transparent, glass-like sheets with a thickness of about 35 mm, foreign inclusions were clearly visible, which on closer inspection turned out to be pistol bullets frozen in the material. This was confirmed by the inscriptions on the plates, which reported that two samples came from Austrian Glock, and another from Czech CZ. A fairly powerful Parabellum cartridge with a caliber of 9X19 could not penetrate a seemingly fragile barrier by a third. Moreover, there were no chips or cracks visible. The bullet seemed to be stuck in the thickness of the material, without even penetrating it completely.

“To check the quality of polycarbonate as a structural plastic, we tried to shoot it," Ruslan Shigabutdinov, the director general of the Group's parent company, TAIF JSC, explained what he saw.

“This is the so-called 'tenth brand' of polycarbonate. The material has a very high impact strength. These are stuck bullets. We have a video where we shot. Polycarbonate was also shot using a rifle. The rifle breaks through such a thickness, but it stucks at already about 70 mm," Farid Minigulov added.

Such demonstration of material strength aroused considerable interest. Especially of the deputy chairman of the management board of Gazprom, Oleg Aksyutin. Why — it revealed later.

“The properties of polycarbonate are known to everyone both theoretically and practically, but today its mechanical and thermal properties have been shown that it can even be used as bulletproof elements. This suggests that it can be used in the areas where such mechanical strength is required. Colleagues from Gazprom became interested in the product, as they have a need for high-strength optical systems for deep-submergence vehicles capable of descending to a depth of more than 2,000 metres. They are going to study this topic. The polycarbonate can be an effective solution to this issue," Ruslan Shigabutdinov, te director general of TAIF JSC, told Realnoe Vremya.

Polycarbonate is able to make a real competition to the long-known plexiglass, Farid Minigulov is sure.

“They are approximately similar in their strength properties — polymethylmethacrylate and polycarbonate. I believe that polycarbonate is even more suitable for this. Therefore, I think that it is quite likely that it can be used for such special applications. I know that our polycarbonate, in cooperation with our client, Safplast, has been homologated for use in space technology. In particular, for the manufacture of helmets," he shared information with journalists.

TAIF-NK and TGC-16

At the stand of TAIF-NK JSC, they also demonstrated their achievements. Later, the deputy general director of the company — director for commerce, Ilshat Fattakhov, told reporters:

“By the results of 2020, the volume of processed raw materials amounted to 7,3 million tonnes. Commercial products worth more than 146 billion rubles were produced. The manufactured products are in great demand on the territory of Tatarstan, Russia and abroad.

TGC-16 JSC this time focused all attention on the practical experience of operating modern water treatment plants. The increase in the production of heat and electric energy at the Nizhnekamsk enterprise of the company required large volumes of specially treated water. The modernisation and replacement of existing capacities was carried out in 2018-2019, and significant results have been achieved to date: the volume of water treatment has increased significantly, while the cost of processes has decreased by more than 43%, and the mineralisation of discharge has fallen by 2,5 times.

Neighbours with SIBUR

TAIF Group's companies have extensive plans for further development, which is described in detail in the Development Strategy for the period up to 2030.

The total cost of 36 projects for the construction of new and the modernisation of existing production facilities included in the perimeter of the transaction for the merger of the petrochemical and energy businesses of TAIF Group and SIBUR Holding PJSC exceeds 1,5 trillion rubles.

Let us remind that the parties announced the planned merger deal in April of this year. It has already received approval of the FAS, and now the parties are actively exchanging delegations and experience, the first steps have been taken in the redistribution of raw materials flows.

After the completion of the merger procedure, the petrochemical holding will be formed in Russia, which confidently claims to be one of the five largest industry giants in the world. By the way, at the Tatarstan Petrochemical Forum, by chance or not, the stands of TAIF Group and SIBUR Holding PJSC were located very close to each other.

Russia does not have enough production facilities for the final conversion of petrochemicals

In addition to an extensive exhibition programe, the Tatarstan Petrochemical Forum is also a large-scale scientific and applied event. In particular, during three days, its participants discussed the most important issues and current trends of the industry on a national and global scale.

For example, one of the key events of the business programme was the International Scientific and Practical Conference 'Decision of the European Union on decarbonisation and the new paradigm for the development of the fuel and energy complex of Russia', and as a continuation and development of the topic — another international conference — 'Prospects for the development of energy systems: decarbonisation of the economy, hydrogen energy'. Both in the first and in the second case, TAIF Group's companies have something to share. For example, Nizhnekamskneftekhim PJSC is already undergoing commissioning of the CCGT-TPP with a capacity of 495 MW.

“At our suggestion, Siemens has modified the gas turbine to match the quality of our fuel mixture. The main idea was to collect the reliefs from all production facilities and send them to high-temperature combustion to the turbine and get additional benefits in the form of electricity and steam energy. Siemens coped with this task perfectly. The first ignition was made. Everything is operating normally. This is both an economically and environmentally beneficial project," said Ruslan Shigabutdinov, the director general of TAIF JSC.

A similar, but smaller, CCGT is currently being built for Kazanorgsintez PJSC.

The forum participants also took part in the International Conference Polyolefins 2021, discussed topical issues of geodesy and geoinformation systems, metrological support for measuring the flow of liquids and gases. Another topic for the dialogue was the quality of hydrocarbon raw materials (the management and specialists of TAIF Group have repeatedly raised this problem — editor's note). Besides, a number of round table discussions were held, where, in particular, they talked about the prospects for expanding the use of petrochemical products of national production in the construction industry and in road construction. It is noteworthy that this issue was raised by President Vladimir Putin at a meeting on the strategic development of the Russian petrochemical industry last December. He then stressed:

“An urgent task is to create a stable demand for Russian petrochemical products. It is necessary to create the market. Own market. First of all, domestic one. In Russia, as well as all over the world, polymer products are widely in demand. In construction, medicine, housing and communal services, food industry and a number of other industries. Its use opens up new, wide opportunities. It gives the opportuntiy to reduce production and operating costs. By times. In particular, due to the longer service life of polymer products. The benefits of its implementation in comparison with outdated materials are quite obvious. For example, in housing and communal services: polymer pipes can save up to 50% of the cost of servicing water pipelines and sewers. At the same time, the share of polymer solutions in housing and communal services is 35%. But, for example, in Europe, which I've mentioned, it is 85%.

Even earlier, at the beginning of September 2020, they discussed this at the Tatarstan Petrochemical Forum. Ruslan Shigabutdinov, the director general of TAIF JSC, then noted that it would be useful for producers of petrochemical products to get acquainted in more detail with the programme aimed at increasing the volume of its use in the construction industry. Where domestic petrochemistry is used, and what is supplied from abroad. The Ministry of Construction of Tatarstan then promised to prepare a special report and submit it to interested companies as soon as possible.

“The issue of the low use of Russian petrochemical products in construction and road construction should rather be addressed to the Ministry of Construction. At the previous meeting, the question was raised about making a catalogue of what is produced in Tatarstan and what these products can be used for. But it still hasn't appeared. Accordingly, the level of demand for such products is lower than one would expect. So far, they prefer to use ready-made imported solutions, overpaying for them. At the same time, no one wants to study what is right here — in the republic," Ruslan Shigabutdinov noted in an interview with Realnoe Vremya.

He also stressed that a similar situation is observed in other industries:

“We produce the latest materials, with high working properties and characteristics, and for some reason no one is in a hurry to implement them in the national economy.

And this is despite the fact that potential consumers are constantly informed about the characteristics and properties of both products that have been manufactured for a long time and new products of petrochemical production, using all possible ways and means: corporate websites, exhibitions, conferences, forums.

“Our products are a real opportunity to increase the strength of both furniture and digging tools, they are suitable for the manufacture of polymer stainless nails, disposable surgical instruments, prosthetics elements. The raw materials produced in Russia can be used as an inert material. The same polycarbonate does not emit any harmful substances at any ambient temperature. But so far it is massively used either in greenhouses, because it is transparent, transmits ultraviolet light and is a heat insulator, or it is sheets for structural elements. That is, this is what lies on the surface. Abroad, they have long understood all the advantages of large-scale and comprehensive use of petrochemical products, but for some reason, it is better to buy a set of disposable medical instruments for surgery from foreigners than to organise production here in Russia," said Ruslan Shigabutdinov.

Petrochemical companies are focused on the development and improvement of production facilities. They simply do not have the time and opportunities to create and organise the processing of raw materials. Surely there will be smart people with business acumen and commercial flair in the country. But, in addition to all this, they need support, Ruslan Shigabutdinov is sure.

“We have the production of raw materials and there is a consumer market, but there is no middle link connecting these two components. There are no final processing plants. There are no people who would do this. These are high-tech things, expensive equipment, need for personnel training, and therefore, we need state support. They will have raw materials — we will provide them. There is a sales market. The instrument for surgical operations needs to be made, and armored glass, and special equipment for deep-sea work… There are still hundreds, if not thousands of areas of application of petrochemistry. But for the development of polymer conversion segment, support is needed for all products necessary for both the country and the world. And this is a state task," the director general of TAIF JSC once again raised one of the most pressing issues for the country's economy.

In fairness, it can be noted that there are some progress, at least in the construction industry, in this direction in Tatarstan. During the round table discussion, First Deputy Minister of Construction, Architecture and Housing of the Republic of Tatarstan Aleksey Frolov said that seven new enterprises producing building materials, including using petrochemical products, were opened in Tatarstan last year. This year, the plant for the production of chemical additives in concrete Polyplast has already started operating, and four more production facilities are expected to be launched. But these are solutions only in one industry, and even them they are not as large-scale as we would like.