China Petroleum and Chemical Corp, commonly known as Sinopec, plans to spend 24 billion yuan (US$3.5 billion) to double capacity of a refining project in Fujian Province.
Asia's biggest oil refiner will expand the refinery - part of China's first Sino-foreign integrated refining and petrochemical project - in the southeast China's province to 24 million tons a year, or about 480,000 barrels per day, according to a newsletter issued by its parent company yesterday.
The expansion plan comes after the Fujian refinery tripled its capacity in 2006, and underscores the ambitions of companies to tap rising demand and expand market share even though the risk of an oversupply is possible.
The plan will soon be submitted to the National Development and Reform Commission, China's top planning agency, for approval, the newsletter said.
At present, the Fujian project is operated by a venture between Sinopec, Exxon Mobil Corp and Saudi Aramco. An Exxon spokeswoman in Beijing said the United States company is not involved in the expansion so far.
The Fujian refinery was first expanded in 2006, with annual crude processing capacity tripled to 12 million tons and other petrochemical units added, at a cost of US$5 billion. The joint venture complex started a full trial run last month, following a test of its crude oil unit that began in May.
Sinopec, rival PetroChina Co and other domestic oil companies are competing to expand refining after the Chinese government eased control on fuel pricing late last year.
Higher fuel prices helped Sinopec end refining losses due to soaring crude costs and saw Chinese refiners boost investment in refining.
(Shanghai Daily September 11, 2009)