The 12million ton oil refining project of Sinochem

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Sinochem's 12million ton oil refining project was put into operation

just as PetroChina postponed its refinery expansion plan, another state-owned oil company, Sinochem Group, officially put into operation yesterday in Fujian Quanzhou's ten million ton oil refining project

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it was learned from Sinochem Group that the annual output of Sinochem Quanzhou oil refining project reached 12million tons, with a total investment of nearly 30billion yuan. This project is not only the first refinery of Sinochem with a level of more than 10 million, but also its first wholly-owned construction project. Sinochem Group, which started from the trade of petroleum and chemical products, has the right to import crude oil and the license to wholesale refined oil. This large-scale entry into the refining sector shows its ambition to open up the upstream and downstream oil industry chain

however, with the slowdown of economic growth, the demand for oil consumption is also slowing down, and many large-scale refinery projects are being postponed. At this time, Sinochem Group's launch of ten million level projects is a "risky move"

The refining project of Sinochem Group is located in QUANHUI Petrochemical Industrial Park, Quanzhou City, Fujian Province. It is a national "12th Five Year Plan" and a key construction project in Fujian Province. The project includes 19 production units including atmospheric and vacuum distillation, catalytic cracking, residue hydrogenation, wax oil hydrocracking, continuous reforming, delayed coking, polypropylene and other supporting utilities, wharfs, storage and transportation facilities

according to Sinochem Group, after being put into operation, it is estimated that the annual sales revenue will be nearly 70billion yuan, and the gasoline and diesel products produced by the project will all meet the European V standard

although it only has the first ten million level project today, Sinochem's involvement in the oil refining business began in the 1980s. Sinochem is the largest shareholder of Dalian West Pacific Petrochemical Co., Ltd., the first Sino foreign joint venture refinery. At present, the crude oil processing capacity of the company is 10million tons/year. In addition to Sinochem, the shareholders of Westpac also include PetroChina, total and other companies, and the operator is PetroChina. In addition, due to the restrictions of domestic sales of refined oil licenses, Westpac's profitability has been limited

outside Dalian West Pacific, Sinochem has been planning wholly-owned oil refining projects. It is reported that Sinochem had previously planned to set up factories in Jinan, Zhoushan and other places, but they were not approved by the government. The Quanzhou project has been approved since 2005.

in December 2008, the National Energy Administration approved to carry out the preliminary work of Sinochem Quanzhou Petrochemical 12million ton/year oil refining project; 20 the world-renowned consulting company Smartech recently issued On August 17, 2011, the environmental impact assessment report of the project was approved by the Ministry of environmental protection; on August 20, 2012, the project was officially approved by the national development and Reform Commission. After the successful commissioning, the Quanzhou project was officially completed and put into operation on July 9, 2014.

Sinochem's ambition

"refining and chemical integration has always been Sinochem's dream, and the Quanzhou project is the first step." Li Li, director of anxins research and Strategy Center, said to. Sinochem, which has the right to import crude oil and the wholesale license of refined oil, now needs to open up the intermediate links of the industrial chain

compared with other central oil enterprises, Sinochem itself does not have oil and gas resources, and the crude oil resources of Quanzhou project will also rely on imports. In order to ensure the smooth operation of the project, Sinochem Group has prepared crude oil from three cargo ships as raw materials for the project in November last year, and the company also plans to use 40% of the capacity of the new refinery to process Iraqi crude oil

storage: as of 2012, the oil storage capacity of Sinochem Group has increased from 6.35 million cubic meters to 10.03 million cubic meters, and the petrochemical storage capacity under operation, construction and management is about 25million cubic meters, and there are many petrochemical storage transit bases in domestic coastal and riverside areas

in the downstream sales field, Sinochem and total jointly established a refined oil sales company covering the economically developed areas of North China, South China and the Yangtze River Delta in 2005. In February this year, Sinochem Quanzhou Petrochemical Co., Ltd. was awarded the "road strip" of refined oil wholesale operation by the Ministry of Commerce

Li Li said that Sinochem also needs to do some supporting construction of distribution and marketing networks in the downstream. Retail is still a challenge for the company, mainly the layout of gas stations. At present, most of the gas stations in Fujian are owned by SINOPEC. The strength is 100 times that of steel. For Sinochem, the cost of building or purchasing gas stations in the future may be very high

"the layout of gas stations is also the next key plan of the company." Yesterday, the relevant person in charge of Sinochem Group told China business news. It is understood that Sinochem has already started to set up gas stations in Southern Fujian and Putian, and will increase the number of gas stations in key cities such as Fuzhou in the next step

Li Li said that for Fujian, Sinochem is a latecomer. In addition to supplementing the market gap, it will also radiate to East and South China, and even overseas, which may be Sinochem's target market. "A ten million level project entering the market will definitely intensify competition." Li Li said

it is learned that up to now, there have been more than 20 ten million level refineries in the country. Due to the rapid expansion of domestic refineries in recent years, coupled with the continued weakness of consumer demand, overcapacity has occurred in this field, and many large-scale oil refining projects have postponed their production time. Earlier, it was reported that PetroChina's two joint-venture refinery projects in Tianjin and Jieyang, Guangdong have been temporarily shelved

an unnamed person from the central oil company said that taking South China as an example, the oil refining capacity of the region has reached 80million tons, with an increase of more than 30million tons in 2012 and 2013. But correspondingly, the growth rate of oil consumption is slowing down

"the Quanzhou project started its preliminary preparation in 2008, and by 2012, the oil demand had begun to shrink gradually." The above-mentioned oil central enterprises said that the price competition of refined oil in Fujian is also relatively sufficient

Li Li said that the completion of a refinery will take 3-5 years. After the project is truly completed, the market may change unpredictably. However, from the perspective of the future development of Sinochem, the configuration of refineries is very important. On the other hand, many projects have been postponed now, and less refining energy has been put into production, which may lead to shortages in the future. It is also a good opportunity for Sinochem

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