Sinopec,
China's largest petrochemical company, yesterday established a
joint-venture with British oil giant
BP to build a petrochemical complex
in Shanghai that could be the largest of its kind in Asia when it
comes on stream in 2005.
The US$2.7 billion joint venture, Shanghai SECCO Petrochemical Co
Ltd, aims to develop a complex that will produce 900,000 tons of
ethylene annually.
BP
Chemicals controls 50 percent of the Shanghai-based joint venture,
while Sinopec holds a 30 percent stake. Sinopec subsidiary Shanghai
Petrochemical Company holds the remaining 20 percent.
The joint venture will also produce a combined total of 1 million
tons of polyethylene, polypropylene and polystyrene a year.
At
yesterday's founding ceremony, Byron Grote, managing director of BP
Chemicals, said: "The Shanghai SECCO project is not only BP's
largest investment in China, but also one of the largest of any
foreign companies in China.
"It is a significant step for our business strategy in the growing
Chinese market."
Sinopec President Wang Jiming said the co-operation with BP would
facilitate the sale of the venture's products in the international
market.
Wang added the project is of great significance in that it will
sharpen the competitiveness of China's petrochemical industry,
especially after entry into the World Trade Organization.
The project also brings closer the realization of China's ambition
to build Shanghai, a promising international financial hub, into
one of the leading petrochemical production bases in the world.
The city is expected to spend 150 billion yuan (US$18 billion) to
construct a petrochemical park where Shanghai SECCO will be
located.
In
addition to the joint venture with BP, Sinopec is currently at work
on another large petrochemical project with another foreign
shareholder, Exxon
Mobil.
Earlier last month, Sinopec signed an agreement with Exxon Mobil
and Saudi Aramco to submit a feasibility study on building a
600,000-ton-a-year ethylene production facility in a Sinopec
refinery in East China's Fujian Province.
Sinopec is to hold half the stake while the other two are to
equally split the rest.
China produces more than 4 million tons of ethylene annually, but
this satisfies only two-thirds of the domestic demand.
The country is expected to double its ethylene capacity to about 8
million tons within the next five to six years through the launch
of several complexes with foreign majors, to meet the increasing
demand.
(China
Daily December 11, 2001)