rongsheng refinery location quotation

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)

BEIJING, Aug 14 (Reuters) - Rongsheng Petrochemical , the listed arm of a major shareholder in one of China’s biggest private oil refineries, expects demand for energy and chemical products to return to normal in the country in the second half of this year.

Rongsheng expects to start trial operations of the second phase of the refining project, adding another 400,000 bpd of refining capacity and 1.4 million tonnes of ethylene production capacity in the fourth quarter of 2020.

“We expect the effects of the coronavirus pandemic on energy and chemicals to have basically faded in spite of the possibility of new waves of outbreak,” said Quan Weiying, board secretary of Rongsheng, in response to Reuters questions in an online briefing.

But Li Shuirong, president of Rongsheng, told the briefing that it was still in the process of applying for an export quota and would adjust production based on market demand. (Reporting by Muyu Xu and Chen Aizhu; Editing by Jacqueline Wong)

Rongsheng Petro Chemical Co, Ltd. specialises in the production and marketing of petrochemical and chemical fibres. Products include PTA yarns, fully drawn polyester yarns (FDY), pre-oriented polyester yarns (POY), polyester textured drawn yarns (DTY), polyester filaments and polyethylene terephthalate (PET) slivers.

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]

Chinese private petrochemical group Zhejiang Rongsheng Holding has signed a framework agreement with state-run shipping conglomerate Cosco Shipping Group to form a strategic partnership.

State oil giant Saudi Aramco signed an agreement on Thursday to invest in a refinery-petrochemical project in eastern China, part of its strategy to expand in downstream operations globally.

The memorandum of understanding between the company and Zhejiang province included plans to invest in a new refinery and co-operate in crude oil supply, storage and trading, according to details released by the Zhoushan government after a signing ceremony in the city south of Shanghai.

Zhejiang Petrochemical, 51 percent owned by textile giant Zhejiang Rongsheng Holding Group, is building a 400,000-barrels-per-day refinery and associated petrochemical facilities that was expected to start operations by the end of this year.

Aramco also owns part of the Fujian refinery-petrochemical plant with Sinopec and Exxon Mobil Corp, and has plans to build a 300,000-bpd refinery with China’s Norinco. It is also in talks with PetroChina to invest in a refinery in Yunnan.

China concentrates most of the refinery projects scheduled to start operation between 2022 and 2023 in the Asian and Middle East region. In terms of refining capacity, Kuwait"s Al Zour refinery is estimated to be the largest project, at 615,000 barrels per day. This is followed by the Jieyang and Rongsheng refineries, both located in China and each with a refining capacity of 400 thousand barrels daily. Meanwhile, the refining capacity worldwide is forecast to expand by one million barrels per day in 2022, with an additional expansion of 1.6 million barrels daily in the following year.Read moreRefining projects scheduled to begin operation in Asia and the Middle East in 2022 and 2023, by refining capacity(in 1,000 barrels per day)CharacteristicRefining capacity in thousand barrels per day--

Saudi Aramco is reportedly set to sign an agreement to purchase a stake in a refinery and petrochemical project in eastern China. Aramco"s senior vice-president of downstream, Abdulaziz al-Judaimi, has been quoted in media reports as saying that the Saudi energy giant is set to invest in the Zhejiang project in eastern China.

The Zhejiang Petrochemical Company, 51 per cent owned by Chinese textile major Rongsheng Holding Group, plans to start its 400,000 barrels a day (b/d) refinery, which is integrated with a petrochemical plant in the eastern province of Zhejiang, in late 2018.

Last month, Aramco signed a long-term deal with Rongsheng to supply about 170,000 b/d crude oil for the project, to be located in the port city of Zhoushan.

Aramco also owns part of the Fujian integrated refinery and petrochemical complex with Sinopec and Exxon Mobil Corp, and has plans to build a 300,000 b/d refinery with China’s Norinco.

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.

11 sets of chemical equipment, including 1 million tons/year ethylene cracking unit, 100,000 tons/year EVA unit, 400,000 tons/year HDPE unit, 200,000 tons/year EO/EG unit, and 200,500 tons/year EO/EG unit. Annual PO/SM unit, 350,000 tons/year PP unit, 120,000 tons/year butadiene extraction unit, 100,000/30,000 tons/year MTBE unit/butene-1 unit, 500,000 tons/year pyrolysis gasoline Hydrogen unit, 350,000 tons/year aromatics extraction unit, 800,000 tons/year P2A unit; 2 sets of oil refining equipment, including newly built 3 million tons/year atmospheric distillation unit and 450,000 tons/year refinery dry gas Pre-refining device.

On January 22, 2021, in order to promote the construction of the second phase of the 40 million tons/year refining and chemical integration project of Zhejiang Petrochemical Co., Ltd., a holding subsidiary of Rongsheng Petrochemical Co., Ltd., Zhejiang Petrochemical as a borrower and 10 banks The syndicate signed the "Syndicated Loan Contract", and the project syndicate agreed to provide the borrower with a medium- and long-term loan line equivalent to RMB 52.7 billion or equivalent foreign exchange.

The refinery area is located in the area west of the Longjiang estuary in the Dananhai Petrochemical Industrial Zone, Jieyang, Guangdong; the crude oil terminal reservoir is located in the Shibeishan area in the southeast of Huilai County; the crude oil terminal is located in the sea near the Shibeishan lighthouse in Jinghai Town; the refined oil terminal is located in the Longjiang River, the Dananhai The waters west of the estuary.

In the trade of Iraqi grades, the country"s State Oil Marketing Organization (SOMO) largely clinched term deals for Basrah Medium and Basrah Heavy for January to December 2022 loading. Of these, China"s Rongsheng Petrochemical and Hengli Petrochemical were newly said to have new annual term contracts with SOMO. Both of the refiners purchased Basrah but these purchases were on spot transactions.