Giant petrochemical complex being built

The construction of a 35.42 billion yuan ($5.1 billion) Sino-Kuwaiti refinery and petrochemical complex, one of the largest international projects of its kind in China, kicked of in the coastal city of Zhanjiang, Guangdong province, last week.

Located on Donghai Island, the country's fifth-largest island, the project is designed to process 10 million metric tons of crude oil and produce 800,000 tons of ethylene annually in its first phase. Such volumes would generate 60 billion yuan in annual output. The complex is scheduled to go into operation in 2020.

The project launch marks a major step in accelerating the construction of a modern industrial system and promoting economic transformation in Guangdong, said Zhu Xiaodan, provincial governor, at the launch ceremony.

It also serves to help safeguard the stability of the domestic oil market and national energy security, he said.

The project is set to boost the economy of Zhanjiang, which is located in western Guangdong, as the government seeks to lift the economy of less-developed parts of the province to promote more balanced growth.

Zhu encouraged the local government to support the project, create a sound investment climate and attract mid- and downstream petrochemical enterprises to Donghai Island to form an industrial cluster.

The National Development and Reform Commission approved the project in 2011. Since then, China Petrochemical Corp (Sinopec Group) has optimized the plans in view of the significant international oil price decline and refining overcapacity, according to the group.

The company is the biggest Chinese investor involved in the project.

Sinopec has planned four "technologically advanced and internationally competitive world-class" refinery and petrochemical bases in Zhenhai, Shanghai, the Maoming-Zhanjiang region and Nanjing to push forward the national industrial upgrade strategy.

The project in Zhanjiang is an important step in implementing supply-side reforms and will serve to enhance the group's global competitiveness, said Wang Yupu, group chairman of Sinopec.

The complex will mainly produce gasoline that meets the National VI standard, diesel, jet fuel and chemical products, including polyethylene and polypropylene.

The project adopts the most internationally advanced techniques in production control, to be built and managed with internationally competitive energy-saving and emission-cutting standards, according to the group.

Just 500 meters away from the refinery stands Baosteel Zhanjiang Iron & Steel's 50 billion yuan mill.

With its first blast furnace going into operation in September last year and its second this July, the mill has an annual capacity of 8 million tons of steel products.

The complex mainly supplies steel for automobile and home appliance manufacturing, ship building and oil production, mainly to serve the South China and Southeast Asian markets.

Baosteel Zhanjiang was the first steel company in China to apply the strictest environmental regulations.

Petrochemical and steel plants can share resources, such as coal gas produced during steel manufacturing.

The local government has planned industrial parks for the petrochemical and steel sectors to accommodate mid- and downstream enterprises.

Guangdong Guanhao High-tech's and Zhanjiang Zhongzhi Paper's papermaking plants, involving investments of 7.6 million yuan and 15 billion yuan respectively, are also situated on Donghai Island.

With the first phase of Guanhao's project going into operation in 2014 and construction of Zhongzhi venture starting last year, the island is becoming one of the country's largest high-end paper manufacturing hotspots.

According to the city's development and reform commission, these massive petrochemical, steel and paper-making projects will contribute an annual industrial output of more than 300 billion yuan in five years.

liwenfang@chinadaily.com.cn

(China Daily 12/27/2016 page11)