China Ups Invest. in Massive Refinery Project

China has invested $1.1 billion in its largest oil refinery and chemical integration project — the Dushanzi 10 million ton refinery and one million ton ethylene project — and will invest another $1.4 billion in the project this year, said the Dushanzi Branch of China National Petroleum Corporation (CNPC), the company in charge of the project, according to a report by Industrial Info Resources (www.industrialinfo.com).

Dushanzi, a petroleum chemical base in China with an area of 90 square kilometers, is a part of China”s northwestern Xinjiang Uygur Autonomous Region, which is adjacent to Kazakhstan. The $3.8 billion project is part of a China-Kazakhstan strategic cooperation on energy and the end point of the 1,000 km long oil pipeline between China and Kazakhstan.

According to the Dushanzi Branch of CNPC, the 10 million ton refinery and one million ton ethylene project consists of three parts: an oil refinery section, a chemical industrial section, and common section. Civil engineering of the oil refinery section has finished and the chemical industrial section has one-third finished. Over one billion dollars has been invested in the aforementioned two parts and another $1.4 billion will have been invested by the end of 2007.

The oil refinery section, which has a 10 million ton capacity, will be finished by October and the 1 million ton ethylene section will be finished by the second half of 2008.

After the huge project is completed, it will process oil transmitted from Kazakhstan”s Atasu by the Atasu-Alashankou oil pipeline between China and Kazakhstan. According to the plan between the two countries, the transmission capacity of the pipeline is currently 10 million tons a year and will be raised to 20 million tons per year in 2010, which Industrial Info says will account for nearly 15 percent of China”s whole oil importation once this happens. Eventually, the capacity of the line will be raised to 30 million tons per year.