BAKU, Azerbaijan, November 2. Kazakhstan's KazMunayGas (KMG), KMG PetroChem LLP, and China Development Bank (CDB) have signed a loan agreement worth up to 2.89 billion yuan (about $400 million) to finance the construction of the country's first main ethane and propane pipelines, KMG PetroChem said.
The agreement provides for a 15-year credit line to finance the EPC contract for the construction of ethane and propane pipelines within a single corridor in the Atyrau region. The loan will be secured by a corporate guarantee from Samruk-Kazyna JSC.
"The agreement with China Development Bank continues the long-standing cooperation between Kazakhstan and China in the energy sector. Today, one of the key areas of this partnership is the development of Kazakhstan's petrochemical industry. Long-term financing on attractive terms will ensure the timely construction of infrastructure for future production facilities and further strengthen our longstanding partnership," said Diana Aryssova, Deputy Chair of the Management Board of KazMunayGas.
The project envisages the construction of two pipelines, each approximately 210 kilometers long, in a shared technical corridor connecting the Tengiz Gas Separation Complex with Karabatan.
The ethane pipeline, with an annual capacity of 1.6 million tons, will supply feedstock to the polyethylene plant currently under construction, while the propane pipeline, with a capacity of 1.1 million tons per year, will supply the existing polypropylene plant.
"We have already begun construction of the main ethane and propane pipelines, which will become an important part of the country's petrochemical cluster. With the comprehensive support of Samruk-Kazyna Fund and KazMunayGas, we have signed a loan agreement with China Development Bank. This is an important outcome of our joint efforts and another step toward securing long-term project financing. The bank's involvement in developing Kazakhstan's gas chemical infrastructure demonstrates the confidence of our Chinese partners and strengthens financial and economic cooperation between our countries," said Diaz Diyanov, Chairman of the Management Board of KMG PetroChem.
The EPC contract for the project was signed in November 2025 with a consortium led by China Petroleum Pipeline Engineering Co., Ltd., with the participation of CITIC Construction Co., Ltd. and ChPPI Kazakhstan LLP.
The contract covers engineering and design, equipment procurement, construction and installation works, and commissioning of the facilities.
