IRVING, Texas (November 15, 2001) -- Fujian Petrochemical Company Limited (FPCL), ExxonMobil China Petroleum and Petrochemical Company Limited, and Aramco Overseas Company B.V. today signed an agreement to submit the joint feasibility study (JFS) for the Fujian integrated petroleum/petrochemical project to the State Development Planning Commission (SDPC) of the People's Republic of China. The JFS will soon be submitted by the three partners to SDPC.
The submission of the JFS will mark a significant milestone in the development of the integrated project at the existing FPCL refinery in Quangang, Fujian Province. FPCL is a joint venture between Sinopec and Fujian Province.
Mr. Jia Xitai, vice governor of Fujian Province, said, "The petrochemical industry is the key pillar industry in Fujian Province. The Fujian integrated petroleum/petrochemical project will definitely promote the development of the industry. The people in Fujian have been eagerly looking forward to this project to which the Fujian provincial government has attached great importance. The signing of the JFS submission agreement today represents a substantive important step undertaken by the three partners in speeding up the development of the petrochemical industry in Fujian province. I believe the Fujian integrated project will certainly promote further economic prosperity and development in Fujian and be a source of pride to the people of Fujian."
Mr. Wang Jiming, president of Sinopec Corp., said, "The Fujian integrated petroleum/petrochemical project is one of the key projects for development of Sinopec Corp. during the 10th Five-Year Plan and in the next ten years. The completion of the JFS is the result of the joint efforts and close cooperation of the project partners. In the wake of China's accession into the WTO, the three partners jointly sign the agreement today to submit the JFS, which marks an encouraging step toward the success of our cooperation."
Mr. Rene Dahan, executive vice president of Exxon Mobil Corporation, said, "I am pleased to see the signing of the JFS submission agreement by the partners in Fujian project. I am confident that our joint efforts will lead to the creation of a world-class and world-scale project that will benefit the people of Fujian and the nation as a whole. We look forward to the submission of the JFS and its approval by the Chinese government."
Mr. Abdulaziz F. Al-Khayyal, senior vice president of Saudi Aramco, said, "The signing of the JFS submission agreement marks a key milestone in the development of the Project and Saudi Aramco's strategic partnership in China. The integrated petroleum refining and petrochemical project has strong and sound fundamentals and will contribute to the exceptional economic development in Fujian in particular and in China in general. We look forward to the Chinese government's acceptance and approval of the JFS."
The Fujian venture will be a Sino-foreign joint venture among FPCL (50 percent), ExxonMobil (25 percent) and Saudi Aramco (25 percent). The JFS is a document through which the partners jointly agree on and define the objectives and plans for the joint venture.
The joint venture will be formed upon approval by the Chinese government of the JFS, the Joint Venture Contract and the Articles of Association of the Joint Venture.
The Fujian project will involve the construction of a new world-scale ethylene steam cracker, and polyethylene and polypropylene units, together with chemical derivatives manufacturing units and related distribution and marketing facilities. The petrochemical complex will be integrated with the refinery, which will expand its existing 80,000 barrel-per-day refining capacity to 240,000 barrels per day.
The expanded refinery will be complemented by a petroleum products marketing joint venture which will supply wholesale and retail products produced by the Fujian joint venture throughout Fujian province. The partners in the marketing joint venture will include Sinopec and affiliates of ExxonMobil and Saudi Aramco.
OCT 17,2002 ExxonMobil
Fujian Project Joint Feasibility Study Approved by Government
Fujian Petrochemical Company Limited (FPCL, a 50:50 joint venture between Sinopec Corp. and the Fujian Province), ExxonMobil China Petroleum and Petrochemical Company Limited and Aramco Overseas Company B.V. announced today that the State Council of the People's Republic of China has approved their joint feasibility study (JFS) for the Fujian integrated petroleum/petrochemical project.
This approval will facilitate finalization of the Joint Venture Contract among the three companies. Thereafter, the contract will be submitted to the Ministry of Foreign Trade and Economic Cooperation for approval.
The Fujian project will be a joint venture among FPCL (50 percent), ExxonMobil (25 percent), and Saudi Aramco (25 percent).
Project co-venturers plan to develop a multi-billion dollar world-class refining, marketing and petrochemical complex in the Fujian Province. The existing FPCL refinery in Quangang, Fujian Province, will be expanded from its existing 80,000 barrels-per-day capacity to 240,000 barrels per day. In addition, the project involves construction of a new world-scale 800,000 tons-per-year ethylene steam cracker, and polyethylene and polypropylene units, together with chemical derivatives manufacturing units and related distribution and marketing facilities. The petrochemical complex will take feedstock from and be operationally integrated with the refinery.
Mr. Jia Xitai, vice governor of Fujian Province, said, "The State Council's approval of the JFS for the Fujian integrated petroleum/petrochemical project is great news for the people of Fujian. The petrochemical industry is one of the pillar industries in Fujian. Its lead project is the Fujian integrated project, which will be highly competitive with its world-class scale and technology. The construction of the project will help improve the structure of the existing petrochemical industry and product mix in the province, facilitate the development of mid and downstream products and speed up the overall progress of Fujian's economy. The people of Fujian will do their best to cooperate with the partners in the project to make it a success."
Mr. Wang Jiming, president of Sinopec Corp., said, "The Fujian integrated petroleum/petrochemical project is one of the key projects for development of Sinopec Corp. during the 10th Five-Year Plan and in the next ten years. The State Council's approval of the JFS indicates that the Fujian integrated project has entered the period of substantive development. Sinopec Corp. will work closely with the project partners to accelerate the pace of the project and achieve the objective of early formation of the joint venture. We believe that we'll build a world-class project with strong competitive edge by leveraging the strengths of all the partners."
Mr. Edward G. Galante, senior vice president of Exxon Mobil Corporation, said, "We are very pleased with the concept of the proposed joint venture, which was submitted to and now endorsed by the State Council. Our experience is that an integrated refining and chemicals project will have strong synergies, and we expect that these synergies will be further enhanced by integration with a Fuels Marketing Joint Venture. This, coupled with the strength and experience of the partners, will ensure a very competitive and potentially very successful venture that will serve the markets in Fujian and China well."
Mr. Abdulaziz Al-Khayyal, senior vice president of Saudi Aramco said, "We are pleased that the State Council has now approved the project's feasibility study. We believe that the Fujian integrated project will be important to both the development of Fujian Province and to greater China. We are confident that the partners will be able to develop a successful venture and are proud that Saudi Aramco will be able to contribute to that success and afford the joint venture a stable and secure source of crude oil feedstock. We look forward to the rapid completion of remaining work related to the Marketing and Manufacturing Companies so that we can obtain our Board and shareholders approvals to form these ventures in the near future."
Sinopec Corp., ExxonMobil and Saudi Aramco will also establish a fuels marketing joint venture for the marketing of fuels products manufactured by the Fujian Integrated Petroleum and Petrochemical Joint Venture. The marketing joint venture, upon approval by the Chinese government, plans to operate 600 service stations in Fujian Province.
Polyolefin products from the chemical plant will be marketed by the partners under off-take arrangements that have been agreed among the partners.
Chemical Week Apr
ExxonMobil-Sinopec JV to Include 1 Million-m.t/year Ethylene Plant
ExxonMobil Chemical’s previously announced petrochemicals joint venture with Sinopec at Guangzhou, China, will include a 1-million m.t./year naphtha cracker, CW has learned. The jv will be equally owned by ExxonMobil and Sinopec, and it is likely to be completed in 2008, sources say. This would be two to three years after scheduled completion of ExxonMobil’s China petchems jv at Hui An, in China’s Fujian province. That project is a jv of ExxonMobil, Saudi Aramco, and Fujian Petrochemical. The Fujian cracker will have an initial capacity of 600,000 m.t./year, expandable to 800,000 m.t./year, sources say, (CW, April 3, p. 16).
ExxonMobil and Sinopec are at the early stages of work on a project proposal for the Guangzhou complex, which they will submit for government approval, sources say. They are expected to begin a feasibility study once the proposal has been approved. ExxonMobil’s partner is Sinopec subsidiary Guangzhou Petrochemical (GPC). The jv is part of an alliance established by ExxonMobil and Sinopec in October 2000 when ExxonMobil bought 20% of the shares sold by Sinopec in a $3.6-billion initial public offering. The accord also includes plans to double GPC’s 150,000-bbl/day refining capacity, and joint construction of up to 500 gasoline stations in Guangdong province. GPC operates a 200,000-m.t./year ethylene plant.
The planned Guangzhou cracker will be the joint largest in China. Dow Chemical is also proposing to build a 1-million m.t./year cracker at Tianjin, provided it can attract other ethylene consumers to become involved in the project. Dow says that the cracker is unlikely to be completed before 2010, however (CW, April 17, p. 19).
ExxonMobil and Sinopec Sign Framework Agreement to Strengthen Strategic Alliance in China
NEW YORK & BEIJING--(BUSINESS WIRE)--Oct. 21, 2002--China Petroleum and Chemical Corporation (Sinopec Corp.) and ExxonMobil China Petroleum & Petrochemical Company Limited, a subsidiary of Exxon Mobil Corporation (NYSE:XOM), today signed a framework agreement that will strengthen the strategic alliance between the two companies and move forward their joint venture projects under development in Fujian and Guangdong Provinces.
This framework agreement follows the recent approval of the Joint Feasibility Study by the Chinese Government for the Fujian integrated petroleum and petrochemical joint venture between ExxonMobil, Sinopec, Fujian Province, and Saudi Aramco.
Mr. Li Yizhong, Chairman of Sinopec Corp., said, "Sinopec Corp. and ExxonMobil sign this framework agreement on the eve of President Jiang Zemin's visit to the United States. It is another important milestone since the establishment of the strategic alliance between our two companies in 2000. It signifies that the development of our strategic partnership has entered a new stage. I believe that after the signing of this framework agreement, we will further strengthen and broaden our cooperative relationship and achieve the various objectives laid out in the agreement."
Mr. Lee R. Raymond, Chairman of Exxon Mobil Corporation, said, " We are pleased to sign this framework agreement with Sinopec, as a reinforcement of the broad co-operation between the two companies. This framework agreement spells out in clear terms the commitment by both companies to achieve specific milestones in the months ahead for our joint venture projects."
ExxonMobil and Sinopec established a strategic alliance between the two companies in 2000. Under this alliance, progress has been made in their joint efforts to develop their cooperative projects in southern China's Fujian and Guangdong Provinces.
In Fujian, ExxonMobil has been working with Saudi Aramco, Fujian Petrochemical Company Limited (FPCL), a joint venture between Sinopec and the Fujian provincial government, to develop an integrated world-scale refinery and petrochemical complex. It involves the expansion of an existing 80,000 barrels-per-day (4 million tons-per year) refinery to a 240,000 barrels-per-day (12 million tons-per-year) capacity and the construction of a new 800,000 tons-per-year ethylene steam cracker with potential total investment of over $3 billion. In addition, the parties are also working toward a fuels marketing joint venture that would operate about 600 service stations in Fujian. The marketing joint venture will market fuel products produced by the manufacturing joint venture.
In Guangdong, the two companies have been evaluating a joint venture that will invest in and expand an existing refinery and petrochemical facilities currently owned by Sinopec. The parties are also developing a fuels marketing joint venture that is expected to operate about 500 service stations within three years of joint venture formation.
Under the framework agreement, ExxonMobil and Sinopec will accelerate and complete the relevant work of the projects according to defined work plans.
In addition, both parties expressed intent to explore new opportunities for broadening their cooperative efforts.
China Chemical Reporter 2003-12-16
Integrated Project in Fujian Petrochemical
construction of the 8.0 million t/a oil refining and 800 000 t/a
ethylene production project in SINOPEC Fujian Petrochemical Co.,
Ltd. has entered the substantive stage.
The integrated project in the company is located along the coast of the Meizhou Bay. It has a total investment of RMB26.692 billion and is jointly funded by Fujian Petrochemical Co., Ltd., (representing SINOPEC and Fujian Province), Exxon-Mobil China Petrochemical Co., Ltd. of the United States and Aramco of Saudi Arabia with an equity ratio of 50:25:25. The existing 4. 0 million t/a oil refining unit in the company is taken as the basis to expand the oil refining capacity by 8.0 million t/a to reach a total of 12.0 million t/a. An 800 000 t/a ethylene unit and downstream processing units, as well as facilities and utilities outside the battery limit including a 300 000t dock, will also be constructed.
The project execution coordination group held the first meeting on Oct. 21 this year. The overall target for the completion of the 8.0 million t/a oil refining unit in 2006 and the completion of the 800 000 t/a ethylene production unit in 2007 was defined. The overall process optimization scheme was passed and the fund utilization plan for the fourth quarter of this year and 2004 was also finalized.
Fujian Petrochemical Co. , Ltd. only had an oil processing capacity of 2.5 million t/a in the first years. The attempt at forming joint venture and integrating oil refining and chemical production was therefore taken as their development concept early in 1993 when the company started production. From 1994 the company contacted several foreign companies to seek ways of cooperation and decided to partner with Exxon-Mobil of the United States and Aramco of Saudi Arabia in the construction of a world-class petrochemical project. On Sept. 18, 2002 the State Council made a positive reply to the feasibility study report on the integrated project and on Oct. 11 the former State Development Planning Commission formally approved the feasibility study report.
The integrated project attracted the attention of domestic and foreign companies from the outset. Joint venture partners in the project include SINOPEC, Fujian Province, Exxon-Mobil of the United States and Aramco of Saudi Arabia. Judging from the performance in the past two years, the operating indexes in the company such as profit per ton of oil, per- capita profit and rate of return on capital hold a leading position in SINOPEC enterprises. Exxon-Mobil is a large multinational with the biggest scale of integration between oil refining and chemical production in the world. Saudi Oil Company, the parent company of Aramco, is the biggest oil producer and exporter in the world. A stable and reliable availability of low-priced crude oil is guaranteed and the freight cost of crude oil transported by super-class oil tanker is not high either.
The integrated project makes an organic combination of oil refining and chemical production. The oil refining section provides the chemical production section with high-quality cracking raw materials such as naphtha and hydrogenated tail gas. Byproducts in the chemical production section such as hydrogen and cracked gasoline are taken back to the oil refining section. Oil refining and chemical production use a single process flow, a single general layout and a single utility system.
In terms of technology and equipment, the production and the unit scale of oil refining, ethylene cracking, polyethylene and polypropylene hold a leading position in the world. All the equipment will be selected and purchased worldwide and the most advanced technology in the world will be used to reduce the cost of construction and operation. The quality of oil products, ethylene, polyethylene and polypropylene can hopefully reach the world advanced level. Advanced concepts and methods of management and advanced modes of marketing will be introduced from Exxon- Mobil. PMC ( project master contraction) will be adopted to save investment and ensure quality. The most advanced environmental protection technologies and equipment in the world will also be used and the quality of environmental protection will therefore hopefully reach the world advanced level. The Meizhou Bay is an excellent natural deepwater port that can berth 300 000t ships and has good conditions for constructing large docks.
According to experts, after the completion of the integrated project in Fujian Petrochemical Co., Ltd. the supply shortage of oil products in Fujian will be changed. Besides meeting the market demand in Fujian, gasoline, kerosene and diesel produced in Fujian Refining and Chemical Co., Ltd. can also be provided to surrounding provinces and used for export.
ExxonMobil denies Fujian project
talks progressing smoothly
There has been "no dramatic change" in discussions between ExxonMobil and its joint venture partners in the Fujian refinery and petrochemical project in China, an ExxonMobil official said Monday. "I would not say there's sharp improvement in talks recently," the official said. The comment was in marked contrast to the optimism from its Chinese partners, following a visit to China this month by the Saudi oil minister, Ali Naimi.
Sinopec, ExxonMobil, Saudi Aramco
and Fujian Petrochemical Sign Agreements to Progress Fujian
Manufacturing and Marketing Projects 福建省泉州市泉港区
Fujian Petrochemical Company
Limited (a company owned 50 percent by China Petroleum &
Chemical Corporation (Sinopec) and 50 percent 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 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 percent), ExxonMobil (25 percent), and Saudi Aramco (25 percent).
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 percent), ExxonMobil (22.5 percent) and Saudi Aramco (22.5 percent), 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.
Exxonl, Aramco start work
on Fujian refinery
Exxon Mobil Corp., the
world’s biggest publicly traded oil
company, and Saudi Aramco started engineering work on a US$3.5 billion
refinery in China’s southern Fujian
Saudi official said.
“We have begun some basic engineering work on the refinery," Abdulaziz al-Khayyal, Saudi Aramco’s senior vice president of refining and oil marketing, said. “We expect to sign a final joint venture agreement by next year."
Exxon, Aramco and China Petroleum & Chemical Corp. (SINOPEC) plan to expand the refinery to process 240,000 barrels of oil a day from 80,000 barrels a day. Exxon and its partners are also building chemical plants, including an 800,000-ton-a-year ethylene plant among other chemical units.
Saudi Arabia, the world’s biggest oil exporter, is investing in oil refineries to secure outlets for its crude oil exports, half of which are consumed in Asia. The kingdom may expand its oil output capacity by 14 percent to ease concern of shortages as demand rises in China and other markets.
China passed Japan as the world’s second-largest oil consumer last year, after the United States. It will need more than 10 million barrels of crude a day by 2030, up from 6.3 million now, according to the International Energy Agency, an adviser to 26 industrialized nations. China’s crude imports rose 34 percent in October as domestic production failed to keep up with soaring demand.
Saudi Arabia was the second-largest overseas supplier of crude to China in October after Angola, supplying the Asian country with 1.5 million metric tons (10.6 million barrels), Beijing-based Customs General Administration said this month.
Saudi Aramco wants to invest in Asia and elsewhere to expand its market share. The company has holdings in refineries in the United States, Japan, Greece, the Philippines and South Korea that process close to 2.3 million barrels of oil a day into fuels.
"We are looking to invest in other refineries with other partners, but we have a higher priority in the Far East because that's where the growth is," al-Khayyal said.
Construction begins on China's Fujian ethylene, refining project
Partners in China's Fujian integrated ethylene and refining joint venture project Friday held a groundbreaking ceremony to mark the start of construction in Quanzhou, Fujian province. The event was attended by senior Chinese ministry and provincial officials, Saudi government officials, and top executives from the partners Sinopec Corp, ExxonMobil and Saudi Aramco, as well as Saudi oil minister Ali Naimi. The project will set up new petrochemical facilities at the complex including an 800,000 mt/year ethylene steam cracker, a 650,000 mt/year polyethylene unit, a 400,000 mt/year polypropylene unit and a 1-mil mt/year aromatics unit. The project will triple the existing Fujian Petrochemical Co's refinery capacity from 4-mil mt/year to 12-mil mt/year (240,000 b/d).
China's First Fully Integrated
Refining, Petrochemicals and Fuels Marketing Joint Ventures with
Inauguration Ceremony in Beijing Marks the Formation of the Ventures
Sinopec, Fujian Province, ExxonMobil and Saudi Aramco today held an inauguration ceremony at the Great Hall of the People in Beijing to mark the formal government approval of Joint Venture Contracts and granting of business licenses for their two joint ventures in Fujian Province - Fujian Refining & Petrochemical Company Limited and Sinopec SenMei (Fujian) Petroleum Company Limited.
The two joint ventures, with a total investment of about US$5 billion, are the first fully integrated refining, petrochemicals and fuels marketing project with foreign participation in China.
The Fujian Refining and Ethylene Joint Venture Project, located in Quanzhou, Fujian Province, will expand the existing refinery from 80,000 barrels-per-day (4 million tons-per-year) to 240,000 barrels-per-day (12 million tons-per-year). The upgraded refinery will primarily refine and process sour Arabian crude. In addition, the project will construct an 800,000 tons-per-year ethylene steam cracker, an 800,000 tons-per-year polyethylene unit, a 400,000 tons-per-year polypropylene unit and an aromatics complex to produce 700,000 tons-per-year of paraxylene. Support facilities including a 300,000 ton crude berth and power cogeneration will also be built. The joint venture company, formally registered as "Fujian Refining & Petrochemical Company Limited," will be owned by Fujian Petrochemical Company Limited (FPCL) (50 percent), ExxonMobil China Petroleum and Petrochemical Company Limited (25 percent) and Saudi Aramco Sino Company Limited (25 percent). The project is expected to start up in early 2009.
The Fujian Fuels Marketing Joint Venture, formally registered as "Sinopec SenMei (Fujian) Petroleum Company Limited," will manage and operate approximately 750 service stations and a network of terminals in Fujian Province. It will be owned by Sinopec (55 percent), ExxonMobil China Petroleum and Petrochemical Company Limited (22.5 percent) and Saudi Aramco Sino Company Limited (22.5 percent).
The ceremony was attended by Mr. Chen Jinhua, former Vice Chairman, the Chinese People's Political Consultative Conference; His Excellency Ali Al-Naimi, Minister of Petroleum & Mineral Resources, Saudi Arabia; Mr. Huang Xiaojing, Governor, Fujian Province; Mr. Chen Tonghai, President, China Petrochemical Corporation (Sinopec Group) and Chairman, China Petroleum & Chemical Corporation (Sinopec Corp.); Mr. Abdallah S. Jum'ah, President & CEO, Saudi Aramco; and Mr. Steve Simon, Director and Senior Vice President, Exxon Mobil Corporation. Other dignitaries from Chinese ministries, Saudi Aramco, ExxonMobil, Sinopec and Fujian Province were also present.
Together, the Fujian Refining and Ethylene Joint Venture Project and the Fujian Fuels Marketing Joint Venture will serve to meet China's rapidly growing demand for petroleum products and petrochemicals. Synergies from these two world-scale, integrated businesses, closely coupled with the strengths of the four partners and a long-term crude supply agreement with Saudi Aramco, significantly enhance the competitiveness of this project, and help ensure its world-class performance. It will also boost the development of China's petrochemical industry and contribute to the economic development of Fujian Province.
1Fujian Petrochemical Company Limited (FPCL) is owned 50% by China Petroleum and Chemical Corporation (Sinopec) and 50% by the Fujian Government. ExxonMobil China Petroleum and Petrochemical Company Limited (ExxonMobil) is a wholly owned affiliate of Exxon Mobil Corporation and Saudi Aramco Sino Company Limited (Saudi Aramco) is a wholly owned affiliate of Saudi Aramco.