Ashurst recently advised Hengyi Industries Sdn Bhd ("Hengyi Industries") on two key developments in relation to the construction and operation of Brunei's second petrochemical refinery: the finalisation of a long-term land lease agreement with the Brunei Economic Development Board ("BEDB") and the shareholder arrangements for the investment by the Strategic Development Capital Fund ("SDFC"), a Brunei government trust sub-fund, into Hengyi Industries.

The land lease agreement involves the long-term lease of a 260-hectare block of land on Pulau Muara Besar island in Brunei Darussalam from BEDB for the purpose of the construction and operation of an integrated crude oil refinery and aromatics complex. Phase 1 of the project is due to be in operation in 2017, when the refinery will produce liquefied natural gas, gasoline, diesel, jet a-fuel, fuel oil, paraxylene, benzene and naptha.

Ashurst also advised Hongkong Tianyi International Holding Company Limited ("Hongkong Tianyi"), a subsidiary of Zhejiang Hengyi Petrochemical Co., Ltd., on the shareholder arrangements for the investment by the SDCF into Hengyi Industries. SDCF is investing in Hengyi industries via its subsidiary, Damai Holdings Limited.  The Share Subscription Agreement and Joint Venture Agreement were signed on 25 February 2014.  Upon completion of the SDCF's investment into Hengyi Industries, Hongkong Tianyi will retain a 70% interest in Hengyi Industries, with Damai Holdings Limited holding a 30% interest.

The Ashurst team was led by Singapore-based partner, Matthew Bubb, assisted by Giles Ashman, of counsel, senior associates Anna Hermelin and Samantha Loh and associate Nicholas Dimitriou.

Matthew Bubb commented:

"We are delighted to have helped Hengyi Industries and Hongkong Tianyi achieve these key milestones in the development of the petrochemical refinery project in Brunei.  We look forward to assisting them with the next stages of development and financing.  The petrochemicals sector is an area of significant growth for our Asia practice, particularly in the emerging South East Asian markets. We have a particularly strong record in Brunei, including acting on the country's first international project financing for the Brunei Methanol project."