Sinopec, ExxonMobil, Saudi Aramco and Fujian Petrochemical sign agreements to progress Fujian manufacturing and marketing projects
Posted: 26 August 2004
Fujian Petrochemical Company Limited (a company owned 50 per cent by China Petroleum & Chemical Corporation (Sinopec) and 50 per cent by Fujian Government) (FPCL), ExxonMobil China Petroleum and Petrochemical Company Limited (ExxonMobil), and Aramco Overseas Company B.V. (Saudi Aramco) reached agreement today to jointly fund the front end loading (FEL) design activity for a more than $3.5 billion dollar project involving expansion of the existing refinery in Fujian Province and addition of a chemical complex.
The project would result in a world-class integrated refining and chemicals complex located at Quangang, Quanzhou City near Meizhou Bay in Fujian Province. ExxonMobil, Sinopec and Saudi Aramco also agreed to submit a joint feasibility study (JFS) for a fuels marketing joint venture in Fujian Province to the government of the People's Republic of China.
The FEL activity includes completing initial engineering and design, selecting contractors, finalizing cost estimates and the development of the pre-ordering of long-lead time equipment. At the conclusion of the FEL effort, the parties will make a final decision on joint venture formation and project construction.
The Fujian Integrated Project will expand the existing refinery in Fujian Province from 80,000 barrels-per-day (4 million tons-per-year) to 240,000 barrels-per-day (12 million tons-per-year) with significant product upgrading capability. The upgraded refinery will be designed to refine and process sour Arabian crude. In addition, the project involves construction of a new 800,000 tons-per-year ethylene steam cracker, polyethylene and polypropylene units, and a new 700,000 ton-per-year paraxylene unit. Currently, completion is estimated for first half 2008. The start of FEL is an important step in developing this major integrated complex.
The Fujian Integrated Project Joint Venture, when formed, will be a Sino-foreign venture among FPCL (50 per cent), ExxonMobil (25 per cent), and Saudi Aramco (25 per cent).
The submission of the fuels marketing JFS will mark a significant step in the development of the Fujian integrated ventures. The JFS is a document through which the parties, Sinopec (55 per cent), ExxonMobil (22.5 per cent) and Saudi Aramco (22.5 per cent), will jointly agree upon and define future objectives and plans. The joint venture will market petroleum products produced by the Fujian Integrated Project throughout Fujian Province.
The Fujian Marketing Joint Venture plans to manage and operate more than 600 service stations and a network of terminals. The joint venture will be formed upon approval by the Chinese government of the JFS and the joint venture contract, and the completion of all other required contracts, agreements and documentation by the parties.
Together, the Fujian Integrated Project and the Fujian Marketing Joint Venture will be the first fully integrated Sino-foreign project to meet China's rapidly growing demand for petroleum and petrochemicals. Synergies among these world-class, integrated businesses will enhance the competitiveness of this project, and provide world-class performance.
For more information see:
www.exxonmobil.com, www.saudiaramco.com
Posted by Richard Price,
Editor Pipeline Magazine
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