Russia might stimulate TPA production to meet domestic demand
MOSCOW. Nov 11 (Interfax) - Proposed amendments to Russia's Tax Code regarding a tax deduction for p-xylene are expected to stimulate the development of terephthalic acid (TPA) production, Deputy Industry and Trade Minister Mikhail Yurin said.
"As you know, we in the Russian Federation have SIBUR's terephthalic acid production [at Polief with capacity of 376,000 tonnes per year], but it does not cover the whole amount of consumption. We produce bottle and fiber grades of polyethylene terephthalate, but all domestic demand is also not covered. Therefore, this is a systemic step to stimulate the development of production of various types of TPA and PET to increase domestic production, cover all domestic demand and, possibly, export these products," Yurin told reporters on the sidelines of the Chemistry-2025 exhibition.
He declined to give a timeframe for the implementation of a potential project to produce TPA. "I think that here the company itself, which is already now in the active phase of preparing the project, will immediately announce as soon as its ready," Yurin said.
A source told Interfax earlier that the Finance Ministry proposed to introduce a new group of recipients of the p-xylene tax deduction - TPA producers. A multiplier of 5.4 for the amount of p-xylene excise paid by the company will be used in calculating the tax deduction for this group. This multiplier will be in effect for 15 years starting with the tax period in which the p-xylene was received on the condition that it is used at a plant with design capacity to produce at least 1 million tonnes of TPA per year. Furthermore, the plant must go into operation no earlier than January 1, 2029 and cost at least 250 billion rubles as of January 1, 2027 at the earliest.
SIBUR head Mikhail Karisalov told Interfax that the petrochemical group does not plan to expand its TPA production capacity.
"It seems to us that we have balanced production. We get p-xylene from Bashneft and Gazprom Neft . The nearest plant in Bashkortostan supplies us 75-80%. There are no such 'live' plans. We also provide terephthalic acid for subsequent processing - production of PET in Tver Region and the very same Bashkortostan," Karisalov said.
Oil company Transneft previously submitted a project for a TPA plant with capacity of 1 million tonnes to state expert review office Glavgosexpertiza for evaluation. It was reported that the company plans to set up production at its Taneco oil refinery and that the project is expected to take ten years. Tatneft plans to supply the TPA to Ekopet, which it acquired in June 2021, as well as to customers on the domestic and international markets.
