China's largest petrochemical joint-venture, Shanghai Secco Petrochemical Co Ltd, announced its mechanical completion yesterday in Shanghai.

With a combined investment of US$2.748 billion by China Petroleum and Chemical Corporation (Sinopec), Shanghai Petrochemical Co Ltd (SPC) and BP East China Investment Co, the project is expected to boast an annual production capacity of 900,000 tons of ethylene, and more than 2 million tons of other related petrochemical products including polyethylene, propylene and polypropylene.

Sinopec holds 30 per cent of Secco's stake, SPC accounts for 20 per cent, and BP takes the remaining 50 per cent share.

Started in March 2002, the joint-venture is expected to begin operation next March, a Sinopec official in charge of the project said.

China's demand for ethylene products is soaring. At present its needs are 50 per cent met by exports, said Sinopec President Wang Jiming, so the establishment of the world-class ethylene production unit plays a significant role in fueling China's petrochemical industry, and further boosting the country's economic development.

China reached an ethylene production capacity of 5.9 million tons in 2003, and the figure is expected to top 6.6 million tons this year, Zhang Jian, an ethylene industry analyst with China Securities told China Daily.

World demand growth for ethylene is expected to exceed the supply increase for 2005, said Zhang, so the price difference between ethylene and its raw material - naphtha, will remain at a relatively high rate.

The establishment of Secco would not exert a great impact upon the world's ethylene demand and supply, said Zhang.