Global Arab Network | Kuwait: China approves $ 9 billion oil refinery project

Translate this article to your language:

GANPublications

e-Publications

Add Site to Favorites

Add Page to Favorites

Make Homepage

Share This Page

RSS Feed

--------------------------------------------------------------------------------------------------------------------
| |

Kuwait: China approves $ 9 billion oil refinery project

Saturday, 11 September 2010 22:12

China (Beijing) - The Chinese Ministry of Environmental Protection has approved a US dollar 9 billion oil refinery project jointly owned by state-run firms Kuwait Petroleum Corporation (KPC) and Sinopec, Global Arab Network learned.

"The environmental assessment report on the proposed project on Donghai Island of Zhanjiang City in south China''s Guangdong Province was granted," the ministry made an official announcement on its Web site with effective until Saturday, reports Kuwait News Agency (KUNA).

"Total investment is CNY 59 billion, which includes CNY 4.26 billion of investment for environment protection," the formal notice said, adding that the Sino-Kuwaiti project includes such facilities as a 15 million-ton-a-year (300,000 barrels per day) refinery, 1 million-ton-a-year ethylene and related utilities, as well as a crude jetty and oil product pipelines to Sanlingsan initial station.

The approval of the Environmental Impact Assessment, which the alliance formally submitted to the ministry late April, was a crucial step for final nod from the Chinese government. Still, the Guangdong provincial government is also required to secure the green light from the Ministry of Land and Resources for the construction of the mega complex, as well as many other procedural approvals.

When realized, Kuwait will become the second Arab oil producer to achieve a desired result after Saudi Arabia, which finally put a refining and petrochemical joint venture into operations last year in the southeast China's Fujian Province after lengthy negotiations with the Chinese authorities. Kuwait Petroleum International (KPI), KPC's international refining and market unit, has been representing Kuwait in talks with the Chinese side.
The project is included in the China's 11th Five Year Plan (2006-2010), while the National Development and Reform Commission (NDRC) already gave preliminary approval to KPC and Sinopec in May, which officially designated Donghai Island as the site for the refinery and petrochemical complex. NDRC is China''s top economic planning agency.

KPC CEO Saad Al-Shuwaib told Kuwait News Agency (KUNA) earlier this year that the joint venture aims to get NDRC's final approval by the end of this year. Under Beijing's initial approval in 2006, the integrated complex was originally planned for the Nansha district of provincial capital Guangzhou, but amid growing concern over the environment impact on the densely populated area, Kuwait and China agreed in May 2009 to relocate the project to much less crowded Zhanjiang City.

The envisaged project also includes a retail network in and around Guangdong Province. OPEC-member Kuwait will supply all the crude to the refinery, which could be China''s biggest joint venture in its kind. KPC and China's downstream leader Sinopec will each hold an equal 50 percent stake in the joint venture, with KPC planning to give 20 percent of its share to their potential international partners.
(with some inputs from Agencies)

Global Arab Network

Add comment

The opinions of the authors in articles published are theirs alone and do not necessarily reflect the views of Global Arab Network
------------------------------------------------------------------------------
Published comments are the opinions of private individuals and do not reflect the views of Global Arab Network