China Petroleum & Chemical Corp. (600028), the nation s biggest fuel supplier, plans to shut its 160,000- barrel-a-day refinery in Luoyang city in central China in September for maintenance, said the head of the plant.
The refinery in Henan province will be shut 45 days and the chemical units will also be closed during the period, Wei Wenbo, president of Luoyang refinery of Sinopec, as China Petroleum is known, said in an interview in Beijing today. The plant will stockpile fuel ahead of the maintenance so that it s able to ensure market supply during that period, Wei said.
The plant s oil processing volume will drop to no less than 7 million metric tons, or 140,000 barrels a day, this year, from 7.58 million tons last year, reducing sales to at least 40 billion yuan ($6.1 billion) from 45.5 billion yuan a year earlier, according to Wei.
Sinopec may more than double the plant s refining capacity to more than 18 million tons by 2020 after the central Chinese province s oil-product demand rose to 10 million tons last year, Wei said. The local government and Sinopec intend to expand, but it is still under planning, he said.
China, the world s second-largest energy user, aims to expand its oil refining capacity by 20 percent, or to add about 100 million tons of annual capacity, in the coming five years as domestic demand rises, the Xinhua News Agency said Jan. 6. The nation s total refining capacity may increase to 600 million tons by 2015, Xinhua reported.
Capacity Expansion
Sinopec s Luoyang plant broke even in the first two months of this year as profit from its chemicals business offset losses for oil processing, Wei said. The plant imports half of its crude, with its crude costs at about $105 to $110 a barrel, he said. They are requesting crude oil grades with higher sulfur content from its parent to reduce costs, he said, without elaborating on what the grades are.
The plant s gasoline and diesel both meet the national III emission standards after upgrades were conducted during the last five years, Wei said.
