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Sinopec Jinling to Expand Oil Refining Capacity 33% (Update1)
By Wang Ying and Chia-Peck Wong
March 8, 2008 (Bloomberg) — Sinopec Jinling Co., a unit of the nation’s largest oil refiner, will expand its crude refining capacity by 33 percent by 2010, as demand for fuels rises in the world’s fastest-growing major economy.
The refinery at Nanjing in the eastern province of Jiangsu will be able to process 18 million metric tons of crude oil by 2010, from the current level of 13.5 million tons, Zhang Dafu, chairman of Sinopec Jinling, said in Beijing today.
China, the world’s second-biggest energy-consuming nation, plans to increase oil-refining capacity by 25 percent by 2010. The economy expanded 11.4 percent last year, boosting demand for fuels and chemicals from PetroChina Co. and China Petroleum & Chemical Corp., also Asia’s largest refiner.
Sinopec Jinling plans to boost its oil processing volume by about 6 percent this year, Zhang said. “More than 80 percent of our crude is imported, and most of the overseas purchases are heavy oil from Saudi Arabia.”
The refinery plans to shut about one-third of its capacity in April and May for maintenance, which will last 30 to 45 days, Zhang said.
China controls fuel prices to shield consumers in the world’s most-populous nation from inflation. That limits the ability of PetroChina and Sinopec, as China Petroleum is known, to pass on the rising cost of crude oil, their main raw material.
Sinopec Jinling may lose 1.5 billion yuan ($211 million) in the first quarter, compared with a profit of 80 million tons last year and a loss of 1.4 billion yuan for the whole of 2006, he said.
Sinopec Jinling may have a profit margin of 5 percent in fuel sales if crude oil prices are $65 a barrel, Zhang said.
The parent company Sinopec said on March 5 it is facing “extremely high” pressures from rising costs caused by record high crude oil prices.
To contact the reporters on this story: Wang Ying in Beijing at wang30@bloomberg.net; Chia-Peck Wong in Hong Kong at cpwong@bloomberg.net. Last Updated: March 8, 2008 02:14 EST -
News Update on Sinopec Jinling Refinery (& Coker) Expansion. The refinery capacity is being expanded by 33% by 2010 which includes the 6% processing increase this year after its maintenance turnaround in April/May 2008.
Not mentioned in this article is the addition of coking capacity planned for the heavy crude expansion. The Sinopec Jinling Refinery is shown on the OGJ survey as the Nanjing refinery but does not show a coker – in fact the OGJ only shows China with 8 coking units making 1.4 million tpy coke and my list shows China with 39 coking units making 11.9 million TPY petcoke. (Note since IEA uses the OGJ Worldwide survey it will also have the OGJ numbers just in case you are doing global petcoke balance).
The Jinling coking expansion (currently has operating coker) is one of +17 refineries in China adding or expanding coking capacity.
Regards
Charlie Randall
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