The central government has finally approved a multi-billion
dollar oil refinery and chemical project in China's economic hub
Guangdong Province following months of feasibility studies.
The project will be built by Chinese and Kuwaiti oil companies,
and is the biggest joint investment on the mainland since China
commenced its opening-up policy in 1978, according to previous
media reports.
An official from the National Development and Reform Commission
said China's planning body has given its approval for Sinopec, the
country's second-biggest oil producer, and Kuwait Petroleum Corp to
start "initial work" on the refinery and chemical project in
Nansha, of the province.
Previous reports said total investment would be $5 billion, the
largest joint venture in China, surpassing the $4.3 billion
petrochemical complex in Huizhou, Guangdong, co-invested by Shell
and CNOOC, China's third-biggest oil company.
The official told China Daily that the proposed ethylene
plant has an annual production capacity of 1 million metric tons,
but would not reveal the capacity of the refinery.
An official surnamed Xie from the Guangdong provincial
development and reform commission confirmed the central
government's approval, saying "the initial work will be started
soon".
It is expected the facilities will begin operation in 2010.
"I think the project will help ensure fuel supply of the
economically fast-paced province," Xie said.
Sinopec said in August that the Nansha plant will be able to
process 12 million metric tons of crude oil a year and the ethylene
unit will have an annual capacity of between 800,000 tons and 1
million tons.
Since last July, expert teams have been conducting feasibility
studies on the environmental impact and how it could be protected
after China and Kuwait signed a memorandum of understanding on the
refinery in December 2005.
Guangdong Province, the manufacturing and chemical powerhouse of
China, has contributed nearly 10 percent of the country's economic
growth but has been experiencing tight supplies of fuel for
years.
Statistics show the province used more than 10 million tons of
oil from January to June, up 11.2 percent year-on-year. Guangdong
purchased more than 50.7 million tons of coal from around the world
in the first five months this year, up 9.9 percent from the same
period last year.
To ensure energy security in the region, the central government
has planned new nuclear plants and oil reserve bases in the
province.
Meanwhile, massive projects to transport natural gases and
electricity from energy-rich western regions have been planned and
partially put into operation.
"When all the projects have been fully put into use and our
energy-saving efforts have been paid off, we can breathe a sigh of
relief," Xie said.
(China Daily December 5, 2007)
