China's CNOOC to launch refinery expansion after $2.7 bln upgrade, sources say

Reuters

04-03-2025

SINGAPORE, March 4 (Reuters) - China National Offshore Oil Company (CNOOC) is slated to launch an upgraded joint-venture refinery complex around June, marking the state-controlled producer's further expansion into refining and petrochemicals, industry sources said.
CNOOC aims to start operating the complex on Daxie island in Ningbo that includes more than a dozen newly installed facilities under a 20 billion yuan ($2.74 billion) expansion programme, potentially raising the firm's demand for imported crude.
The key additions include a 120,000 barrels-per-day (bpd) crude unit, a 3.2 million-metric tons per year (tpy) catalytic cracker, a 2-million-tpy hydrocracker, a 2.4 million tpy continuous reformer and two polypropylene units each sized 450,000 tpy, a recent CNOOC procurement tender document said.
The upgrade expands crude processing capacity at the Daxie plant by 50% to 240,000 bpd as a smaller crude unit was mothballed, also scales up its capacity for making raw materials for plastics and synthetic fibre, according to three industry sources with knowledge of the matter.
The expansion at Daxie would lift CNOOC's total crude processing capacity to about one million bpd in China, including plants the state firm controls and invests, said one of the sources.
CNOOC's largest subsidiary is based in Huizhou of south China's Guangdong province, where a CNOOC-controlled 440,000-bpd refinery is integrated with a petrochemical complex jointly invested by Shell (SHEL.L), opens new tab.
The sources declined to be named as they are not authorized to speak to the media.
CNOOC, parent of offshore oil and gas specialist CNOOC Ltd (600938.SS), opens new tab, manages the state group's refining and petrochemical business.
CNOOC's refining and chemical division said on its official WeChat platform on Tuesday that the Daxie plant was heating up its crude oil unit, part of the preparation works before the plant launch.
A CNOOC representative did not immediately comment.
CNOOC earlier this year won a rare batch of crude import quota of 3 million metric tons (60,000 bpd), which traders said was allotted to the expanded Daxie refinery that is 33% owned by private chemical group Union King Holdings.
Separately, CNOOC is building an underground commercial oil storage base at Daxie with total capacity of 5 million cubic meters (31.5 million barrels), according to a company procurement tender document posted last September.
The site, to be built in two stages, is expected to be completed by end of 2027, according to the document. CNOOC operates a similar-sized oil reserve base in the refining hub of Shandong province.
($1 = 7.2924 Chinese yuan renminbi)