Wei Liucheng, general manager of CNOOC, said the refinery will have a primary capacity of 12 million tons a year. It is designed to provide raw materials for the CNOOC-Shell Nanhai ethylene project, also located in Huizhou and due to begin construction Friday.

According to Wei, CNOOC will likely build service stations to develop an oil product sales network after the new refinery begins operation.

Sources said the CNOOC-Shell Nanhai project, which will produce800,000 tons of ethylene every year, will require a total investment of 4.3 billion US dollars, to be equally funded by CNOOC and Shell. The project is expected to begin operation in late 2005.

Apart from the ethylene and refinery projects, CNOOC is constructing China's largest chemical fertilizer production center in Hainan Province and will also begin building a liquefied natural gas receiving terminal in Shenzhen, the first of its kind in China.

Wei said CNOOC is working to shift from a pure upstream oil company to a complex energy company being strong in both the upstream and downstream sectors in five years.

(Xinhua News Agency November 2, 2002)