LowVI Energy Politics & Supply Security10 November 2026, Tuesday
SOCAR picks the technology for its Aliağa polyethylene complex
SOCAR has chosen the technology licensor for the 850,000-tonne-a-year polyethylene complex that Petkim will build in Aliağa. The project is part of a $7 billion petrochemicals plan; a final investment decision has yet to be taken.
Report.az reported on 10 November that SOCAR chief engineer Rovshan Khalilov announced the completion of technology selection for Petkim's new polyethylene complex. The chosen licence is UNIPOL PE technology from Univation Technologies, a Dow Chemical subsidiary; Petkim itself was founded in 1965. The plant will have a capacity of 850,000 tonnes a year. Front-end engineering and design (FEED) began in September 2026 with a $70 million budget and is due to finish at the end of 2027.
The plan did not originate in 2026. Daily Sabah reported on 6 January 2025 that Petkim's board approved the project in December 2024, with implementation expected to take 5–10 years. The same report said a final investment decision was expected by the end of 2026 and the financing structure had not been set. SOCAR Türkiye executives said at the time that Türkiye imports up to 90% of its polyolefin needs.
OC Media links the announcement to recent tensions between Baku and Ankara and recalls Erdoğan's visit to Shusha on 8 November. The same report puts SOCAR's investment in Türkiye at about $19.5 billion, making it the country's largest foreign investor. With import dependence of up to 90%, the project aims to cut Türkiye's petrochemicals bill through domestic production backed by Azerbaijani capital.
Talay assessment
Bottom line
Technology selection is a real step, but it is not the investment itself: the $70 million FEED runs to the end of 2027 and financing for the $7 billion plan is still open. The final investment decision expected by end-2026 will most likely slip because of the FEED timetable. The timing of the announcement suggests Baku foregrounds economic ties during periods of tension with Ankara.
Likely effects
- Petrochemical importsPositive6 months+
Once on stream, 850,000 tonnes a year of polyethylene capacity will reduce Türkiye's polyolefin import dependence of up to 90%; the effect will not show before 2028 at the earliest.
- Türkiye–AzerbaijanUncertain1–6 months
Coming on top of $19.5 billion of existing investment, the plan increases Baku's economic weight in Ankara and acts as a stabiliser during political tensions.
Possibilities, ranked
- 1Decision slips to 202760%
With FEED finishing at the end of 2027, the final investment decision and financing package are pushed back to 2027–2028.
Watch: Petkim's filing on the Public Disclosure Platform (KAP) on the final investment decision and financing
- 2Partial decision at end-202625%
SOCAR takes an investment decision on the first phase at year-end and arranges financing with export credit agencies.
Watch: SOCAR Türkiye's year-end investment announcements
- 3Plan scaled back15%
Weak petrochemical margins or financing problems lead to cuts in capacity or budget.
Watch: The naphtha–ethylene spread and plan updates in Petkim's quarterly presentation
Probabilities are calibrated judgement based on the sources, not measurement, and are revised as new information arrives. Not investment advice.