China Petroleum & Chemical (Sinopec) plans to spend 19.3 billion yuan (HK$23.7 billion) to build the nation's largest oil refinery in the eastern province of Jiangsu, to meet the mainland's rising fuel demand.
The world's second-largest crude oil refiner by capacity has formed acommittee with the provincial government on the mega project, which will be located in the coastal city of Lianyungangand will integrate oil refining and petrochemical production, reported Sinopec News, a corporate newsletter published by parent China Petrochemical Corp.It did not provide further details.
But according to a Xinhua report last month, the project would have an annual refining capacity of 32 million tonnes and construction could start as early next year under an agreement signed between Sinopec and the provincial government.
The first phase of development involves 12 million tonnes of annual oil refining capacity andfacilities capable of churning out one million tonnes of paraxylene,a chemical used to makepolyester. The second phase includes 20 million tonnes of oil refining capacity and facilitiesto make one million tonnes of base chemical ethylenea year.
The agreement also includes the construction of a wharf large enough to accommodate oil tankers with storage capacity of 300,000 tonnes of fuel, Xinhua reported.
National Business Daily reported last month that the mega project still needs approval from the National Development and Reform Commission. It cited a Lianyungang official responsible for the project.
It also quoted Sinopec deputy chairman Wang Tianpuas saying that the company plans to form a joint venture with a large international petrochemical firm to co-invest in the project. A Sinopec spokesman could not be reached for comment.
Sinopec was operating 34 refineries at the end of last year, with a total annual processing capacity of 247 million tonnes, according to its annual filing to the Securities Exchange Commission in the United States, where its shares are traded.
If completed, the 32-million-tonne-a-year refinery will be much larger than Sinopec's largest operating refinery in Zhenhai, Zhejiang province, which has an annual capacity of 23 million tonnes.
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