Sinopec Evaluating Five Refinery Expansions

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Researched by Industrial Info Resources (Sugar Land, Texas). A spokesman for Sinopec announced earlier this month that the corporation is considering expanding its five oil refineries, among which a $1.3 billion project has started.

China Petroleum and Chemical Corporation--Sinopec (NYSE:SNP) (Beijing, China) will enlarge five refineries: Anqing refinery (Anqing city, Anhui province), Changling refinery (Yueyang city, Hunan province), Jingmen refinery (Jingmen city, Hubei province), Baling refinery (Yueyang city, Hunan province) and Wuhan refinery (Wuhan city, Hubei province). All are along the Yangtze River.

It was reported that Sinopec's Anqing subsidiary has invested $1.3 billion in an eight million tons per year refinery expansion project Sinopec’s Baling subsidiary also disclosed intension to expand capacity, but is still without a clear plan.

The Jingmen refinery is capable of processing 5.5 million tons of crude oil every year and intends to enlarge its capacity to six million tons a year. The Wuhan refinery is mainly for fuel oil and capable of processing five million tons of crude oil every year; however, its real production is lower than the designed amount. Sinopec currently has 17 oil refineries with yearly capacity over five million, and eight oil refineries over 10 million tons.

Sinopec started to expand its refineries in 2004; the biggest expansion was Zhenhai refinery, which was expanded from 17 million tons a year to 20 million tons. In 2006, Sinopec built an eight-million-ton refinery in Hainan province. Refineries in Guangzhou city and Shanghai city were expanded from 7.7 million tons and 8.8 million tons to 13 million tons and 14 million tons respectively. A 10 million ton Qingdao (also called Tsingtao, Shandong province) refinery will be completed soon this year.

By the end of 2008, Sinopec's total capacity will increase to 30 million tons a year.

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