CNOOC Dongying Petrochemical Company Seeks Final Approval for $820 Million Dongying Refinery Expansion

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Written by Faye Wang from Industrial Info Resources (Sugar Land, Texas)--CNOOC Dongying Petrochemical Company Limited is seeking final approval and full funding for its 30,000-barrel-per-day (BBL/d) refinery expansion. The project requires a total investment of $820.45 million.

CNOOC Dongying Petrochemical Company Limited signed cooperation agreements with Shandong Zhonghai Chemical Group Company Limited and China National Offshore Oil Corporation (CNOOC) (Beijing). CNOOC has a 51% stake, thus making CNOOC Dongying Petrochemical Company a state-owned holding company. It plans to upgrade petrochemical and associated projects located within an 86.66-hectare area in Hekou District, west of the existing refining area.

A signing ceremony for the CNOOC Dongying Petrochemical expansion and upgrading project investment agreement was held in Dongying Hotel on July 30, 2013. It is one of the most important industrial projects for Dongying in 2013, key to the implementation of the city's three major crude oil refining projects.

Other major units include a new 70,000-BBL/d crude unit; a 40,000-BBL/d fluid catalytic cracking unit, which adopts Sinopec RIPP MDG technology; a 6,000-BBL/d LPG treater; a 60,000-ton-per-year MTBE; a 36,000-BBL/d diesel hydrotreater; a 16,000-BBL/d gasoline hydrotreater; a 10,000-BBL/d catalytic reformer; a 100,000-ton-per-year aromatics extraction; two 5,000-ton-per-year sulfur recovery units; and supporting facilities.

After completion of the units, the refinery's processing capacity will reach 100,000 BBL/d of crude oil, possibly allowing the company to realize an income of $3.3 billion. Tax disbursements could reach $1.1 billion upon implementation the expansion project. This can boost development of the local petrochemical industry, improve dynamics of the oil refining industry chain, and transform and upgrade traditional and related industries in the city.

So far, the CNOOC Dongying Petrochemical refinery expansion and upgrading project's preliminary feasibility study has been submitted to CNOOC for full funding approval, and awaits China National Development and Reform Commission's decision to issue environmental approvals. Construction is expected to last two years, with kick-off by December 2014.

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