Chinese company signs Egypt chemicals deal
28 July 2025
Egypt’s Red Sea Refining & Petrochemical Company (RSNRPC) and China National Chemical Engineering Company (CNCEC) have signed a non-binding framework agreement to develop the Red Sea petrochemical project in the Suez Canal Economic Zone, according to a statement from Egypt’s Ministry of Petroleum & Mineral Resources.
The signing of the agreement for the project, which has previously been estimated to be worth $1.7bn, took place at CNCEC’s headquarters in Beijing.
At the signing ceremony, Ibrahim Abdel Qadir Makki, chairman of the board of directors of the Egyptian Petrochemicals Holding Company (ECM), said the agreement represented a milestone in the development of a “promising” project.
He also said that CNCEC had shown it was prepared to potentially contribute to the project’s capital, alongside its potential support in a financing arrangement, covering up to 85% of the value of the engineering, procurement and construction contract (EPC).
The agreement signing ceremony was also attended by representatives from Chinese financial institutions, including Bank of China, China Export & Import Bank and Sinosure Export Insurance Company.
Makki said that the Red Sea project has competitive advantages due to its strategic location near the Suez Canal, and the availability of production unit licences.
He also said that there was increasing global demand for products such as polyethylene and polypropylene (PP).
Project delays
Prior to the latest deal with CNCEC, the project had been on hold for more than 18 months.
The project has seen several setbacks over recent years.
Previously, the project was set to be developed by Sidpec in Alexandria with a budget of $1.7bn.
In 2020, Sidpec initiated a review of the feasibility and financial structure of the polypropylene facility, given the economic impact of the Covid-19 pandemic.
Bids for the polypropylene plant were submitted on 2 October 2019 and, at the time, the contract was expected to be awarded in April 2020.
There were significant delays to the contract award amid the Covid-19 pandemic, which led to restrictions on movement and a decline in demand for refined products and petrochemicals.
In October 2020, MEED reported that Sidpec had extended the bid bond for its project to develop the polypropylene facility in Alexandria.
The companies that submitted bids for the project were:
- Saipem (Italy)
- Samsung (South Korea)
- HQC (China)
- China National Chemical Engineering Company (China)
- Technip Energies (France)
Bids for the project were submitted after several delays and bid deadline extensions.
Prequalification documents for the project were submitted in April 2019, and the contract for the front-end engineering and design (feed) was awarded to US-based Jacobs.
Sidpec partnered with the Egyptian Ministry of Petroleum & Mineral Resources and Egyptian Petrochemicals Holding Company (Echem) for the project.
The project’s scope originally included the construction of a polypropylene plant with a capacity of 450,000 tonnes a year, as well as an air-separating unit and associated facilities.
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AD Ports signs Jordan Aqaba port PPP deal6 February 2026
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Chinese firm wins Ceer automotive supplier park deal6 February 2026
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Chinese firm wins Ceer automotive supplier park deal
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