Sinopec Plans to Expand Oil Refining Capacity in Shanghai to 1 Million BBL/d in Five Years

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Researched by Industrial Info Resources (Sugar Land, Texas)--Preparation recently started on the environmental impact assessment report for the 240,000-barrel-per-day (BBL/d) Caojing Oil Refining Expansion Project to be performed by Sinopec Shanghai Gaoqiao Petrochemical Corporation (Pudong, Shanghai), a subsidiary of China Petrochemical Corporation (Sinopec) (Beijing). The project is expected to receive approval and begin construction in 2011, as disclosed by Gaoqiao Petrochemical on September 21.

Sinopec has two large oil refineries in Shanghai: the Gaoqiao Petrochemical and Sinopec Shanghai Petrochemical Company Limited (Jinshan, Shanhai) (SHA: 600688), with primary crude oil processing capacity of 226,000 BBL/d and 280,000 BBL/d, respectively. These two refineries mainly process crude oil imported from abroad.

In addition to the two in operation, Sinopec plans to build a 240,000-BBL/d refinery in the Shanghai Chemical Industry Park, which is expected to receive approval within this year. Along with the proposed 240,000-BBL/d refinery in Caojing, Sinopec's oil refining capacity in Shanghai will be augmented by 480,000 BBL/d to about 1 million BBL/d within five years.

As reported, the proposed 240,000-BBL/d expansion project in Caojing will be designed to process mixed crude oil with sulfur content of 2.94%. With the adoption of the process route of "mixed type with total hydrogenation," a total of 18 sets of production devices will be built in the refinery, with gasoline and diesel as the main products. In addition to the refining facilities, an associated pipeline project and crude oil storage and transportation port will be built; the crude oil port will be located at the Cezi Island in Zhoushan, with an annual design turnover of 20 million metric tons. The proposed 107-kilometer crude oil pipeline will be routed from the port to the transfer oil tank in Baisha Bay in Zhejiang province, and further extended to the proposed refinery in Caojing.

According to the development plan, Sinopec will expand or build a total of 13 refining projects, including seven expansion projects and six new projects, with a total add-on capacity of 1.36 million BBL/d in coming years.

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