rongsheng refinery location for sale

SINGAPORE, Oct 14 (Reuters) - Rongsheng Petrochemical, the trading arm of Chinese private refiner Zhejiang Petrochemical, has bought at least 5 million barrels of crude for delivery in December and January next year in preparation for starting a new crude unit by year-end, five trade sources said on Wednesday.

Rongsheng bought at least 3.5 million barrels of Upper Zakum crude from the United Arab Emirates and 1.5 million barrels of al-Shaheen crude from Qatar via a tender that closed on Tuesday, the sources said.

Rongsheng’s purchase helped absorbed some of the unsold supplies from last month as the company did not purchase any spot crude in past two months, the sources said.

Zhejiang Petrochemical plans to start trial runs at one of two new crude distillation units (CDUs) in the second phase of its refinery-petrochemical complex in east China’s Zhoushan by the end of this year, a company official told Reuters. Each CDU has a capacity of 200,000 barrels per day (bpd).

Zhejiang Petrochemical started up the first phase of its complex which includes a 400,000-bpd refinery and a 1.2 million tonne-per-year ethylene plant at the end of 2019. (Reporting by Florence Tan and Chen Aizhu, editing by Louise Heavens and Christian Schmollinger)

SINGAPORE (Reuters) - China’s Rongsheng Petrochemical has bought its first condensate cargoes for its mega refinery to be delivered in December, trade sources said on Thursday.

Saudi Aramco today signed three Memoranda of Understanding (MoUs) aimed at expanding its downstream presence in the Zhejiang province, one of the most developed regions in China. The company aims to acquire a 9% stake in Zhejiang Petrochemical’s 800,000 barrels per day integrated refinery and petrochemical complex, located in the city of Zhoushan.

The first agreement was signed with the Zhoushan government to acquire its 9% stake in the project. The second agreement was signed with Rongsheng Petrochemical, Juhua Group, and Tongkun Group, who are the other shareholders of Zhejiang Petrochemical. Saudi Aramco’s involvement in the project will come with a long-term crude supply agreement and the ability to utilize Zhejiang Petrochemical’s large crude oil storage facility to serve its customers in the Asian region.

Phase I of the project will include a newly built 400,000 barrels per day refinery with a 1.4 mmtpa ethylene cracker unit, and a 5.2 mmtpa Aromatics unit. Phase II will see a 400,000 barrels per day refinery expansion, which will include deeper chemical integration than Phase I.

Abu Dhabi National Oil Company (ADNOC) has signed a broad framework agreement with China’s Rongsheng Petrochemical to explore domestic and international growth opportunities in support of ADNOC’s 2030 growth strategy.

The companies will examine opportunities in the sale of refined products from ADNOC to Rongsheng, downstream investment opportunities in both China and the United Arab Emirates (UAE) and the supply of liquified natural gas (LNG) to Rongsheng.

Under the terms of the deal, the companies will also study chances to increasing the volume and variety of refined product sales to Rongsheng as well as ADNOC’s participation as the China firm’s strategic partner in refinery and petrochemical projects. This could include an investment in Rongsheng’s downstream complex.

In return, Rongsheng will also look at investing in ADNOC’s downstream industrial ecosystem in Ruwais, UAE, including a proposed gasoline-to-aromatics plant as well as reviewing the potential for ADNOC to supply LNG to Rongsheng for use within its own complexes in China.

Rongsheng’s chairman Li Shuirong added that the cooperation will ensure that its project, which will have a refining capacity of up to 1 million bbl/day of crude oil, has adequate supplies of feedstock.

2021 marked the start of the central government’s latest effort to consolidate and tighten supervision over the refining sector and to cap China’s overall refining capacity.[14] Besides imposing a hefty tax on imports of blending fuels, Beijing has instituted stricter tax and environmental enforcement[15] measures including: performing refinery audits and inspections;[16] conducting investigations of alleged irregular activities such as tax evasion and illegal resale of crude oil imports;[17] and imposing tighter quotas for oil product exports as China’s decarbonization efforts advance.[18]

Last October, Beijing reduced crude oil import quotas awarded to small independent refineries for the first time since they were allowed into the market while raising them for larger, more efficient private plants. Among the primary beneficiaries of these new allocations are a new generation of provincial-backed independent players long interested in expanding into the oil refining business.[19]

Yet, of the three most recent major additions to China’s greenfield refinery landscape, none are in Shandong province, home to a little over half the country’s independent refining capacity. Hengli’s Changxing integrated petrochemical complex is situated in Liaoning, Zhejiang’s (ZPC) Zhoushan facility in Zhejiang, and Shenghong’s Lianyungang plant in Jiangsu.[21]

As China’s independent oil refining hub, Shandong is the bellwether for the rationalization of the country’s refinery sector. Over the years, Shandong’s teapots benefited from favorable policies such as access to cheap land and support from a local government that grew reliant on the industry for jobs and contributions to economic growth.[22] For this reason, Shandong officials had resisted strictly implementing Beijing’s directives to cull teapot refiners and turned a blind eye to practices that ensured their survival.

But with the start-up of advanced liquids-to-chemicals complexes in neighboring provinces, Shandong’s competitiveness has diminished.[23] And with pressure mounting to find new drivers for the provincial economy, Shandong officials have put in play a plan aimed at shuttering smaller capacity plants and thus clearing the way for a large-scale private sector-led refining and petrochemical complex on Yulong Island, whose construction is well underway.[24] They have also been developing compensation and worker relocation packages to cushion the impact of planned plant closures, while obtaining letters of guarantee from independent refiners pledging that they will neither resell their crude import quotas nor try to purchase such allocations.[25]

In 2016, during the period of frenzied post-licensing crude oil importing by Chinese independents, Saudi Arabia began targeting teapots on the spot market, as did Kuwait. Iran also joined the fray, with the National Iranian Oil Company (NIOC) operating through an independent trader Trafigura to sell cargoes to Chinese independents.[27] Since then, the coming online of major new greenfield refineries such as Rongsheng ZPC and Hengli Changxing, and Shenghong, which are designed to operate using medium-sour crude, have led Middle East producers to pursue long-term supply contracts with private Chinese refiners. In 2021, the combined share of crude shipments from Saudi Arabia, UAE, Oman, and Kuwait to China’s independent refiners accounted for 32.5%, an increase of more than 8% over the previous year.[28] This is a trend that Beijing seems intent on supporting, as some bigger, more sophisticated private refiners whose business strategy aligns with President Xi’s vision have started to receive tax benefits or permissions to import larger volumes of crude directly from major producers such as Saudi Arabia.[29]

The shift in Saudi Aramco’s market strategy to focus on customer diversification has paid off in the form of valuable supply relationships with Chinese independents. And Aramco’s efforts to expand its presence in the Chinese refining market and lock in demand have dovetailed neatly with the development of China’s new greenfield refineries.[30] Over the past several years, Aramco has collaborated with both state-owned and independent refiners to develop integrated liquids-to-chemicals complexes in China. In 2018, following on the heels of an oil supply agreement, Aramco purchased a 9% stake in ZPC’s Zhoushan integrated refinery. In March of this year, Saudi Aramco and its joint venture partners, NORINCO Group and Panjin Sincen, made a final investment decision (FID) to develop a major liquids-to-chemicals facility in northeast China.[31] Also in March, Aramco and state-owned Sinopec agreed to conduct a feasibility study aimed at assessing capacity expansion of the Fujian Refining and Petrochemical Co. Ltd.’s integrated refining and chemical production complex.[32]

The 400,000 barrels-per-day oil refinery will be accompanied by two ethylene plants. It will also include an oleflex propane dehydrogenation unit, which is expected to produce 600,000t of polymer-grade propylene.

The integrated refinery and petrochemical project is expected to produce more than 20 petrochemical products such as gasoline, diesel, jet coal, paraxylene, high-end polyolefin, and polycarbonate. Aromatics for plastic resins, films, and fibers will be produced in the first phase, using Honeywell"s UOP technology.

The refinery will utilize three UOP Unicracking process units to convert vacuum gas oil and distillate into petrochemical feedstock. The phase will also include production facilities for aromatics and blend stocks along with normal butane.

Abu Dhabi National Oil Company signed an agreement with Rongsheng Petrochemical of China to explore domestic and international opportunities as it seeks to sell more products to customers in East Asia.

"The strategic co-operation with Adnoc will ensure that our ZPC project, which will have a refining capacity of up to 1m barrels per day of crude, has adequate supplies of feedstock," Li Shuirong, chairman of the Rongsheng Group, said.

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Saudi Aramco signed three Memoranda of Understanding (MoUs) on Friday to purchase a 9 percent stake in Chinese Zhejiang Petrochemical"s integrated refinery and petrochemical complex in the city of Zhoushan, and to invest in a retail fuel network in the eastern region of China, the Saudi state-run energy giant announced.

The first agreement was signed with the Zhoushan government to acquire its 9 percent share in the 800,000-barrels-per-day integrated refinery and petrochemical complex, according to the company"s statement.

According to the press release, phase I of the project will include a newly-built 400,000-barrels-per-day refinery with a 1.4 million-metric-tons-per-annum (mmtpa) ethylene cracker unit, and a 5.2 mmtpa aromatics unit. Phase II will see a 400,000-barrels-per-day refinery expansion, which will include deeper chemical integration than phase I, it said.

MOSCOW (MRC) -- In Asia and the Middle East, at least nine refinery projects are beginning operations or are scheduled to come online before the end of 2023, said Hydrocarbonprocessing.

At their current planned capacities, they will add 2.9 MMbpd of global refinery capacity once fully operational. In the International Energy Agency’s (IEA) June 2022 Oil Market Report, the IEA expects net global refining capacity to expand by 1.0 MMbpd in 2022 and by an additional 1.6 MMbpd in 2023. Net capacity additions reflect total new capacity minus capacity that has closed.

The scheduled expansions follow a period of reduced global refining capacity. Net global capacity declined in 2021 for the first time in 30 years, according to the IEA. The new refinery projects would increase production of refined products, such as gasoline and diesel, and in turn, they might reduce the current high prices for these products.

China’s refinery capacity is scheduled to increase significantly this year. The Shenghong Petrochemical facility in Lianyungang has an estimated capacity of 320,000 bpd, and they report that trial crude oil-processing operations began in May 2022. In addition, PetroChina’s 400,000 bpd Jieyang refinery is expected to come online in the third quarter of 2022. A planned 400,000 bpd Phase II capacity expansion also began operations earlier this year at Zhejiang Petrochemical Corporation’s (ZPC) Rongsheng facility.

Outside of China, the 300,000 bpd Malaysian Pengerang refinery (also known as the RAPID refinery) restarted in May 2022 after a fire forced the refinery to shut down in March 2020. In India, the Visakha Refinery is undergoing a major expansion, scheduled to add 135,000 bpd by 2023.

New projects in the Middle East are also likely to be an important source of new refining capacity. The 400,000 b/d Jizan refinery in Saudi Arabia reportedly came online in late 2021 and began exporting petroleum products earlier this year. More recently, the 615,000 b/d Al Zour refinery in Kuwait—the largest in the country when it becomes fully operational—began initial operations earlier this year. A new 140,000 bpd refinery is scheduled to come online in Karbala, Iraq, this September, targeting fully operational status by 2023. A new 230,000 bpd refinery is set to come online in Duqm, Oman, likely in early 2023.

These estimates do not necessarily include all ongoing refinery capacity expansions. Moreover, many of these projects have already been subject to major delays, and the possibility of partial starts or continued delays related to logistics, construction, labor, finances, political complications, or other factors may cause these projects to come online later than estimated. Although the potential for project complications and cancellations is always a significant risk, these projects could otherwise account for an increase of nearly 3.0 MMbpd of new refining capacity by the end of 2023.

The Abu Dhabi National Oil Company (ADNOC) has signed a broad framework agreement with China’s Rongsheng Petrochemical to explore domestic and international growth opportunities which will support the delivery of its 2030 smart growth strategy

The agreement will see both companies explore opportunities in the sale of refined products from ADNOC to Rongsheng, downstream investment opportunities in both China and the UAE, and the supply and delivery of LNG to Rongsheng.

Under the terms of the agreement, ADNOC and Rongsheng will explore opportunities for increasing the volume and variety of refined products sales to Rongsheng as well as ADNOC’s active participation as Rongsheng’s strategic partner in refinery and petrochemical opportunities, including investment in Rongsheng’s downstream complex.

In return, Rongsheng will also explore potential investments in ADNOC’s downstream industrial ecosystem in Ruwais, including the proposed Gasoline Aromatics Plant, GAP, and the potential for ADNOC to supply and deliver LNG for utilisation by Rongsheng within its production complexes in China.

Abu Dhabi National Oil Co. said Tuesday it signed an agreement with China"s Rongsheng Petrochemicals Co. to explore local and international opportunities as the UAE"s national oil producer looks to bolster its presence in Asia.

Both companies will look into opportunities for ADNOC"s sale of refined products to Rongsheng, downstream investments in both China and the UAE and ADNOC"s supply and delivery of LNG to the Chinese company, ADNOC said in a statement.

"This framework agreement builds on the existing crude oil supply relationship between ADNOC and Rongsheng, which we are keen to enhance," ADNOC CEO Sultan al Jaber said in the statement. "The agreement covers domestic and international growth opportunities across a range of sectors, which have the potential to open new markets for our growing portfolio of products and attract investment to support our downstream and gas expansion plans."

Under the agreement, ADNOC may boost the volume and variety of refined product sales to Rongsheng, and explore the possibility of ADNOC becoming an active participant in the Chinese company"s refinery and petrochemical project opportunities, including in Rongsheng"s downstream complex.

In return, Rongsheng will look into potential investments in ADNOC"s downstream projects in the industrial hub of Ruwais such as its gasoline aromatics plant. ADNOC will also potentially supply and deliver LNG to Rongsheng"s facilities in China.

"The strategic cooperation with ADNOC will ensure that our ZPC project, which will have a refining capacity of up to 1 million barrels per day of crude, has adequate supplies of feedstock," Li Shuirong, chairman of Rongsheng Group, said in the statement.