By Chen Aizhu and Shu Zhang
SINGAPORE (Reuters) – China’s Sinopec Corp is set to launch a new $5.7 billion refining and petrochemical complex in the south of the country in second-quarter 2020 using crude oil from Kuwait as a key feedstock, industry officials with knowledge of the matter said.
The project being developed by Asia’s top refiner, a 200,000 barrels-per-day (bpd) plant in Zhanjiang, a coastal city in Guangdong province, will become the third greenfield refinery-petrochemical complex to be built in China within a space of two years.
Sinopec <0386.HK> is seeking to finalise a crude oil supply deal that will help boost Kuwait’s oil sales to China to a record of nearly 600,000 bpd next year, the sources said. They declined to be identified because they were not authorized to talk to media.
The 40 billion yuan ($5.69 billion) complex comes on the heels of two privately invested mega-refineries – Hengli Petrochemical <600346.SS> and Zhejiang Petrochemical Corp – that have piled onto an over-supplied domestic fuel market where demand for transportation fuels slowed and China’s fuel exports soared.
Sinopec did not respond to a request for comment.
The refinery is slated for start-up in April, followed by an ethylene plant in June next year, said one official briefed on the progress of the plant, located on Donghai island, Zhanjiang.
(Reporting by Chen Aizhu and Shu Zhang; Editing by Florence Tan and Kenneth Maxwell)