Sinopec to Join Kuwait Petroleum in Joint Venture

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Researched by Industrial Info Resources (Sugar Land, Texas)--The signing ceremony for the memorandum of understanding between China Petroleum & Chemical Corporation (NYSE:SNP) (Sinopec) (Beijing), Kuwait Petroleum Corporation (KPC) (Kuwait City, Kuwait) and the government of the Guangdong province was held in Guangzhou, the capital city of the Guangdong province, on October 26. Shulin Su, general manager of Sinopec Group; Sa'd al-Shuwaib, CEO of KPC; and Yang Wang, member of the Political Bureau of the CPC Central Committee and Secretary of the CPC Guangdong Committee, attended the signing ceremony.

The memorandum was signed by Sinopec Limited President Tianpu Wang; Hussein Ismail, President of Kuwait Petroleum International Limited (KPI) (Safat, Kuwait); and Longyun Huang, Deputy Governor of Guangdong province.

According to the memorandum, the parties will jointly promote the construction of the Sino-Kuwait Guangdong Oil Refinery & Petrochemical Complex joint venture project, attempting to have the project approved and under construction as soon as possible.

The proposed Guangdong Oil Refinery & Petrochemical Complex is to be jointly invested by Sinopec, KPI and Petrochemical Industries Company Limited (Safat, Kuwait), two subsidiaries of KPC. The project has a total planned investment of about $8.8 billion, with a total planned refining capacity of 300,000 barrels per day and an annual ethylene production capacity of 1 million metric tons. The facility will primarily process crude oil imported from Kuwait.

Sinopec and KPC initially selected Nansha as the project site. Because of environmental constraints the location was changed. Both parties selected Donghai Island, Zhanjiang City, as the new site early this year, and kicked off the feasibility study report and the environmental impact assessment report for the new site in August 2009.

As reported, the joint venture project will be adopted with advanced process and pollution control technology. The project will play an important role in promoting the local economic and social development in western Guangdong.

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