CNOOC to Receive Asset Injection on Oil Refining and Renewable Energy

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Researched by Industrial Info Resources (Sugar Land, Texas). China National Offshore Oil Corporation Limited (CNOOC Limited) is expecting to receive asset injection from its parent company China National Offshore Oil Corporation (CNOOC). Chairman of CNOOC Limited, Fu Chengyu, said the possible asset injection will include oil refining, renewable energy and petrochemical projects. Through increased buying of international oil and gas assets and importing liquefied natural gas, the energy provision target of 2010 will be met. By then, the energy supply to inland China will increase from the present 40 million tons to 100 million tons of oil equivalent.

According to CNOOC, CNOOC Limited will become a comprehensive petroleum industrial corporation. Petroleum refining and chemical two-in-one business and the asset injection of renewable energy will elevate CNOOC Limited’s status. Neither of the two large projects by CNOOC in Guangdong province, Zhonghai Petroleum Refining and Chemical and Zhonghai Shell Petrochemical, was included in the asset injection plan. CNOOC Limited’s Zhonghai Huizhou 12 million ton refinery will start production in June 2008. This project will mainly process high acid heavy crude oil in the Bohai area in Northeastern China.

In January 2006, Zhonghai Petroleum Refining and Chemical signed an agreement with the largest private oil company in Shanghai – Shanghai Xingcheng Petroleum Company Limited. Through the agreement, Zhonghai obtained over 50% of Xingcheng’s shares by trading its oil resources with Xingcheng. This way, Zhonghai gained 20 gas stations in Shanghai, 26 companies previously owned by Xingcheng and an oil storage with the capacity of 16,600 cubic meters. The total investment from CNOOC on refined oil is around $650 million.

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