China's oil giant PetroChina plans to increase its share in the domestic refining sector to 45% by 2020 from the current 40%, as demand for oil products and petrochemicals is rising, Chinese state media reported.
The country's largest upstream producer has aimed at lifting its refining capacity to 300 million mt/year (6 million b/d) by 2020, the China Daily newspaper quoted PetroChina vice president Shen Diancheng said.
PetroChina's refining capacity will reach 165 million mt/year by 2010, from about 140 million mt/year in 2007, roughly 40% of China's total, the newspaper cited Shen as saying.
PetroChina plans to operate six refineries with 10 million mt/year of crude processing capacity by 2010, the vice president said, adding that the number is expected to triple to 18 refineries by 2020.
EYES 343% JUMP IN 2010 ETHYLENE OUTPUT
PetroChina's capacity to produce ethylene, a raw material used to make plastics, paints and household detergents, will rise to 4.57 million mt by 2010 and 12 million mt by 2020, compared with 2.71 million mt in 2007, Shen said.
The company operates China's largest refinery, the PetroChina Dalian complex, in northeast Liaoning province with 20.5 million mt/year of crude processing capacity.
PetroChina is building a new 10 million mt/year (201,370 b/d) refinery in southwestern China's Guangxi Zhuang Autonomous Region, and is expanding crude processing capacity of its Dushanzi refinery in northwestern Xinjiang region and Jinxi refinery in northeastern Liaoning province by 10 million mt/year each.
Last month, the oil giant received approval from the Chinese central government to build a new 10 million mt/year refinery in southwestern Sichuan province. It has also expressed interest to build two more refineries, with a
minimum 10 million mt/year of crude processing capacity each, in eastern Shandong province and southwestern Yunnan province.
Meanwhile, PetroChina's state-owned parent, China National Petroleum Corp., is teaming up with Russia's Rosneft to develop a 10 million mt/year oil refinery project in China's northern Tianjin municipality.
SINOPEC'S QINGDAO, FUJIAN REFINERIES
Chinese oil companies are boosting their refining and petrochemical production capacities to meet demand of the world's fastest growing economy. Rising wealth has increased sales of cars, pushing up gasoline and diesel consumption. China will have to double refining capacity by 2020 to meet demand, Shen said.
Chinese integrated oil company, Sinopec, is also expanding its crude processing capacity in mainland China.
It will raise capacity of its largest refinery, Sinopec Zhenhai Refining and Chemical in eastern Zhejiang province, to 23 million mt/year (460,000 b/d) by September 2009 from the current 20 million mt/year in order to provide feedstocks for a new 1 million mt/year ethylene plant.
Sinopec is also preparing to launch its 10 million mt/year greenfield Qingdao refinery in eastern Shandong province in summer this year.
Works are also underway at Sinopec's 4 million mt/year joint-venture Quanzhou refinery in southern Fujian province to triple crude processing capacity to 12 million mt/year by early 2009, in order to provide feedstocks for a new 800,000 mt/year ethylene steam cracker jointly controlled by Sinopec, local Fujian government, ExxonMobil and Saudi Aramco.
Other projects involving expansion of secondary processing capacity are also ongoing at key Sinopec refineries, which will ultimately lift overall primary crude processing capacity.
CNOOC, SINOCHEM JOINING THE GAME
Chinese state offshore producer, China National Offshore Oil Corp., is set to enter the country's refining scene with its new 12 million mt/year (240,000 b/d) Huizhou refinery development in southern Guangdong province. Construction of the project is scheduled to be completed by September 30 this year, and a trial run will follow in the fourth quarter.
Sinochem Corp., China's biggest chemical trader, is also building the first phase of a 12 million mt/year fuel oil processing plant by Fujian's Meizhou Bay. Construction of the 5 million mt/year first phase, which began at the start of 2008, will take two years to complete, with commercial operation to begin in early 2010.
"PetroChina and Sinopec are facing more and more competition from domestic rivals and are trying to shore up their market share," the newspaper cited said China Merchant Securities' oil analyst Qiu Xiaofeng as saying.
Source: Platts
