BEIJING—Russian oil firm Rosneft Oil Co. has agreed to sell majority control of its Far East Petrochemical Co (FEPCO) project in Nakhodka, Russia, to China National Chemical Corp. (ChemChina), which will become a key strategic partner in the project that includes synthetic rubber.
Rosneft Chairman Igor Sechin and ChemChina Chairman Ren Jianxin signed a memorandum of understanding for cooperation in the Rosneft project during Russian president Vladimir Putin's recent visit to Beijing.
“By signing the memorandum, Rosneft involves a strategic partner for FEPCO project and makes a major step toward its development,” the news release said. The transactions contemplated are subject to due diligence and the relevant corporate and regulatory approvals, Rosneft said.
Tire-maker Pirelli & C. S.p.A.—which ChemChina is in the process of acquiring—is a key research and development partner in the FEPCO project, which aims to produce, among others, styrene butadiene rubber for “green” tires.
Rubber produced at FEPCO, situated in Nakhodka, a Pacific port city close to the Russia-China-North Korea border, will be used by Pirelli in its tire production facilities in south Pacific region.
Pirelli agreed in May 2014 to consider cooperating with Rosneft on the FEPCO complex's synthetic rubber production.
