SINOPEC Engineering Secures US\$1.093 Billion EPC Contract for Major Kazakhstan Butadiene and Rubber Project

Key Highlights

• SINOPEC Engineering (Group) Co., Ltd. (“the Company”, SEHK: 2386) has announced the award of a major EPC (Engineering, Procurement, and Construction) contract from Kazakhstan Butadiene LLP Company.
• The value of the contract is approximately US\$1.093 billion, which will be added to the Group’s order backlog.
• The contract covers comprehensive EPC services, including engineering design, procurement, and construction of process units, utilities, and auxiliary facilities.
• The project is located in the Atyrau Region, Republic of Kazakhstan.
• The project owner, Kazakhstan Butadiene LLP, is a wholly-owned subsidiary of Samruk-Kazyna JSC, Kazakhstan’s sovereign wealth fund.
• Upon completion, the facility will have an annual production capacity of 300,000 tonnes of butadiene rubber.

Details of the Project

The awarded project is a significant development for SINOPEC Engineering, marking a large-scale international contract in the petrochemical sector. The contract confirms the Group’s leading position in delivering complex engineering and construction solutions to global clients. The project will involve:

• Engineering design of advanced butadiene rubber production units
• Procurement of specialized equipment and materials
• Construction of process units, utilities, and auxiliary support facilities

The project supports Kazakhstan’s ambition to develop its downstream chemical industry and will contribute to local production capacity, with an annual output of 300,000 tonnes of butadiene rubber, an essential material in the automotive and manufacturing sectors.

Potential Impact on Shareholders and Share Price Sensitivity

• Order Book Strength: The US\$1.093 billion contract is substantial and will be fully reflected in the Group’s backlog, potentially strengthening future revenue visibility and investor confidence.
• Market Expansion: This project marks further expansion of SINOPEC Engineering’s international footprint, especially in Central Asia, and demonstrates the Group’s competitiveness in winning large-scale overseas contracts.
• Profit Forecast: The Board emphasizes that the contract and its estimated value do not constitute a profit forecast. The actual impact on the Group’s bottom line will depend on execution, project timelines, and other market factors.
• Shareholder Advisory: Investors and shareholders are advised to exercise caution when dealing in the Company’s shares as the revenue recognition and profit impact will depend on the project’s execution and related accounting policies.

Leadership and Corporate Governance

The announcement was authorized by the Company’s Board of Directors, including Executive, Non-executive, and Independent Non-executive Directors. The project aligns with the Group’s strategy to pursue value-added, international contracts.

The Board includes:

• Executive Directors: JIANG Dejun, ZHANG Xinming, XIE Yanli
• Non-executive Directors: XIANG Wenwu, LI Chengfeng, YU Renming
• Independent Non-executive Directors: YE Zheng, ZHAO Jinsong, ZHANG Xuyan

Conclusion

The award of this US\$1.093 billion EPC contract is a major development for SINOPEC Engineering, reflecting its strong market position and ability to deliver complex international projects. While the contract will boost the order backlog, shareholders should note that the final profit contribution remains subject to project execution and other factors.

Disclaimer: This article is based on the official announcement from SINOPEC Engineering (Group) Co., Ltd. The information does not constitute investment advice or a profit forecast. Investors should exercise caution and consider their own circumstances before making any investment decisions. The company or its directors do not accept responsibility for any loss arising from reliance on this information.

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