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SIBUR & Kaluga Region's Administration Sign an Agreement to Develop a Polymer Processing Cluster

Source: 6/2/2017, Location: Asia

At the St Petersburg International Economic Forum, Anatoly Artamonov, the Kaluga Region's Governor, Alexey Kozlov, SIBUR's Managing Director, Horst Schmidt, CEO of Karl Schmidt Spedition GmbH & Co. KG (KSS), and Nikolay Kruchinin, CEO of Freight Village Kaluga (Freight Village RU), signed an agreement to develop a new polymer processing cluster in the Kaluga Region.

The agreement is an extension of the logistics hub memorandum executed earlier by the parties. As part of it, KSS is to set up a logistics hub at the Freight Village Vorsino to distribute SIBUR's polymer products, including those to be delivered from ZapSibNeftekhim, Russia's largest petrochemical facility under construction in Tobolsk. The arrangements in place provide for receiving, packaging, storing, and shipping SIBUR's polymer products to its customers in Russia and abroad during 20 years after the hub housed by Russia's first freight village, becomes operational. The hub will be using one the warehousing facilities adjacent to the terminal's container yard.

SIBUR's products will be delivered from its production sites in dry bulk containers, a transportation method unique in Russia and more efficient compared to the conventional transportation in pallets, as it allows to transport more cargo and cut packaging costs. This will help optimise logistics by moving part of packaging operations from Tobolsk to the region of destination. SIBUR will use the hub to ship its products to the Central Federal District, while also considering the development of the rail transit corridor to East Europe. Container trains will arrive at the Freight Village Vorsino's rail terminal. Comprehensive hub-related services will be provided to SIBUR by KSS.

The amount of SIBUR's polymer products processed at the hub will be 500 ktpa. The hub has a design capacity of 670 ktpa that may be further expanded. The yard for 1,300 40-feet containers and the upgraded storage area will be able to accommodate over 40,000 tonnes of polymers, and ensure timely deliveries to buyers.

KSS's investments in the project will exceed RUB 2 bn, net of VAT.

The agreement signed at the forum will set forth a number of initiatives to develop the polymer processing cluster in the Kaluga Region, apply new polymer-based solutions in a variety of areas, and boost the investment appeal of regional industrial parks.

“The new hub and polymer processing cluster will contribute to the development of the Kaluga Region's modern facilities processing polymers and manufacturing end products for the automotive industry, healthcare, utilities and other sectors. Here, we are betting on small and medium business. The project will attract Russian and international investments and expertise, and have a multiplier effect on the regional economy," noted Anatoly Artamonov, the Kaluga Region's Governor.

SIBUR's Managing Director Alexey Kozlov said, "Our intent is to improve the availability of polymers to our existing and prospective clients by setting up dedicated transshipment hubs in high-demand regions, including the ones based in industrial parks. The Kaluga Region is the best location for SIBUR's new hub as it lies in the Central European part of Russia and houses a number of rapidly growing facilities forming the automotive cluster and the biotechnology, pharmaceutics and healthcare cluster. Those are key polymer consumers."

KSS CEO Horst Schmidt added, "KSS is bringing to Russia innovative logistic solutions that will optimise both polymer production and processing. With SIBUR, our long-standing partner, we set up logistics platforms for RusVynil and ZapSibNeftekhim, and we are happy to take part in this new project in the Kaluga Region. We are confident that the hub's services will also see strong demand from our European clients."

At the same time, Nikolay Kruchinin, CEO of Freight Village RU, said, "The choice of Vorsino Freight Village as a hub for polymer distribution across Russia and Europe emphasizes the logistics potential of our project. This potential is underpinned by the site's proximity to the target market and the unique concept enabling the parties to leverage the advantages offered by our container terminal over the next 20 years and set up their new hub on the basis of the existing warehousing capacities."

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