Oleg Kostin is a regular speaker at GBC conferences and he will attend the upcoming event in Kazan together with Igor Yesin, Chairman of the Board of the NIIC company.

Expecting the inaugural international Downstream Tatarstan conference GBC talked to Oleg Kostin, Director General of the NIIC (Research & Design Institute of Urea and Organic Synthesis Products). He answered to few questions regarding business potential of gas chemical industry and engineering sector in Russia and Tatarstan.

NIIC is a research institute with long history and one of the leading engineering companies involved in many petrochemical projects in Russia, and in Tatarstan in particular.

On today’s highly competitive international gas market, deeper gas processing is becoming a well-felt need. And this is why, in my opinion, Russian gas chemical industry has a great future.

This view is supported by the fact that more and more companies start thinking on how to diversify their activities, and come to us for expert review of prospective gas processing areas. They include both experienced gas processors and those who, until recently, mostly operated in the field of gas production.

Our company does not only handle different stages of its core activity – carbamide production – but also conducts other operations such as the production of ammonia, methanol, nitric acid, ammonia nitrate, GTLs, carbamide-ammonia mixture, compound fertilizers, melamine. Companies have different criteria to assess the appeal of gas processing areas but the very fact that they are ready to take on new production challenges says that the Russian gas chemical industry is moving forward.

Indeed, most of foreign companies don’t do engineering to the extent required to pass Project Appraisal and obtain a construction permit.

First of all, to develop design documentation – a set of documents submitted for Project Appraisal – you need to know the Russian regulatory framework pertinent to the project which is not very obvious and sometimes inconsistent.  And even if you re familiar with the local norms, obtaining a design license will require certification of the employees involved, which a foreign company will hardly be willing to do. Besides, development of design documentation should comply with all of the regulatory provisions, some of them being very specific (Extreme Operating Conditions, HSE, Feasibility Study, Engineering Measures for Emergency Situations and Civil Defense, and others), which means the documentation should consider infrastructural solutions that would align the facility under construction with the existing premises.

That’s why, for a foreign contractor/licensor, deep diving into Russian regulatory environment would cost significantly more than for a local engineering firm. Therefore, this kind of cooperation is mutually profitable: licensor provides basic design, a primary and key part of the documentation containing universal and standardized data whereas a Russian company applies its experience and adapts the project to the requirements of the Russian legislation. This being said, each company minimizes their financial and time expenses.