(Yicai Global) July 26 -- China National Chemical Engineering Group, one of the country's largest engineering, procurement and construction firms, plans to build a one-million tons capacity nylon 66 factory to satisfy increasing demand at home and aboard for the synthetic polymer used in textiles and plastics.

It will be China's first nylon 66 plant to own the complete production chain, including intermediate items, according to a statement issued yesterday by strategic investor Qixiang Tengda Chemical. The factory will use techniques independently developed by CNCEG's units and will end overseas firms' monopoly on production technologies of adiponitrile, one of the raw materials.

The new factory will be located in Zibo, Shandong province, near Qixiang Tengda's headquarters, CNCEG said yesterday. It will take three years to build the first phase which will have annual production capacity of 200,000 tons. This will include the construction of production equipment for acrylonitrile, hydrogen cyanide, sodium cyanide, adiponitrile and many other intermediate or byproducts, as well as supporting utilities and auxiliary facilities. No details were given about financing.

Chemical product maker Qixiang Tengda will supply the project with propylene, butadiene, adipic acid and many other raw materials that it makes. This will help optimize the firm's product structure and operating efficiency, and was one of the reasons it decided to invest in the project, the company said.

A joint venture with registered capital of CNY2.7 billion (USD392.5 million) will be set up to oversee plant construction. Two subsidiaries of Beijing-based CNCEG will have 75 percent stake in the JV, while Qixiang Tengda will own 10 percent. The remaining 15 percent will be shared between the three firms.