Major news: Yanshan Petrochemical will be relocated in its entirety to Caofeidian! 06:38, June 8, 2017: The relocation project for Yanshan Petrochemical was approved as early as 2015, but it has yet to be launched. The relocation is now set to be carried out officially, and one of the reasons for it is to free up water resources for the **new area**. Xu Kuangdi, head of the Beijing-Tianjin-Hebei Coordinated Development Committee and honorary president of the Chinese Academy of Engineering, recently confirmed officially that Sinopec’s Yanshan Branch in Beijing (hereinafter referred to as Yanshan Petrochemical) is set to be relocated. On June 6, Xu Kuangdi, head of the Beijing-Tianjin-Hebei Coordinated Development Committee and honorary president of the Chinese Academy of Engineering, revealed at the 2017 Annual Meeting of the China Urban 100 Forum that Yanshan Petrochemical will be relocated in its entirety to Caofeidian. Xu Kuangdi stated in his speech that one of the reasons for the relocation of Yanshan Petrochemical was to free up water resources for the new area. “Since Yanshan Petrochemical uses water from the Taihang Mountains, the water saved as a result of the relocation will meet the water needs of the expanded area of **1,000 square kilometers. ”Yanshan Petrochemical is located in Fangshan District, to the southwest of Beijing, 50 kilometers away from the city center. Xu Kuangdi said that the planning for the new area is still under thorough consideration, and key issues being discussed include water resources. “It is hoped that when the new district is established, it will not suffer from water shortages like Beijing, and consideration should even be given to bringing river water into the new district. Several reservoirs in the Taihang Mountains have water quality classified as category two, and the Ministry of Water Resources has approved the direct diversion of water from the Taihang Mountains to the **new area. ” He also said that since crude oil can be used directly through sea transport, the production costs of Yanshan Petrochemical will decrease by 15% after it moves to Caofeidian. Yanshan Petrochemical is affiliated with Sinopec Group Corporation. Established in 1970, it currently has a crude oil processing capacity of 10 million tons per year, and an ethylene production capacity of over 800,000 tons per year; it is one of the larger refining and chemical enterprises in the Beijing-Tianjin-Hebei region. The proposal to relocate Yanshan Petrochemical to Caofeidian has been in progress for several years, and it was approved by the **National Development and Reform Commission in 2015. The environmental impact assessment report for Sinopec’s 10-million-ton oil refining project in Caofeidian, affiliated with the Beijing Yanshan branch, was completed in 2013. The report stated that due to limitations on environmental capacity in the area where Yanshan Petrochemical is located, it was necessary to develop the project elsewhere; the total investment required for this relocation was estimated at 28.5 billion yuan. Sinopec plans to build a refinery with a capacity of 10 million tons, building on the refining infrastructure of Yanshan Petrochemical Branch and taking advantage of the deep-water port facilities in Caofeidian as well as the convenient transportation of imported crude oil, thereby creating a cluster of state-owned petrochemical enterprises in the Bohai Sea region. As the site chosen for the relocation of Yanshan Petrochemical, Caofeidian is a **key petrochemical industry hub planned for development. The \"Petroleum and Chemical Industry Planning Scheme\" issued in 2014 designated Caofeidian as one of China’s seven major petroleum and chemical industry bases. The 2015 Outline for the Coordinated Development Plan of Beijing, Tianjin, and Hebei explicitly designated Caofeidian as a functional area under this strategic plan, with its role defined as a petrochemical base. However, since 2015, the relocation of Yanshan Petrochemical to Caofeidian has not been initiated; instead, Sinopec Group has been working on upgrading and modernizing the existing Yanshan Petrochemical facility. Starting in 2013, Sinopec invested 20.92 billion yuan to upgrade the facilities and carry out environmental protection upgrades at its refining and chemical enterprises, of which 1.83 billion yuan was invested in Yanshan Petrochemical. In addition, Yanshan Petrochemical invested over 600 million yuan in 2016 to carry out technological upgrades for oil product refinement. A responsible official from Yanshan Petrochemical said at a press conference at the beginning of this year that the company will continue to invest in projects for upgrading its facilities, in order to further improve the quality of petroleum products in Beijing. Yanshan Petrochemical is one of the first suppliers in Beijing to provide finished oil that meets the “Beijing VI” standards. According to Sinopec, Yanshan Petrochemical has been supplying \"Jing-6\" gasoline to more than 560 gas stations across Beijing since February 2017, with an annual supply volume of 3 million tons – accounting for about 75% of the total gasoline consumption in Beijing. Although it has contributed to the upgrading of oil products in Beijing, Yanshan Petrochemical’s development has hit a bottleneck due to environmental capacity constraints; moreover, its excessive emissions have come under scrutiny by environmental protection authorities. The Outline of Beijing’s 13th Five-Year Plan proposes phasing out general industries, especially those with high resource consumption. Among these, industries with high consumption include the chemical industry. Yanshan Petrochemical was previously found by the Ministry of Environmental Protection to be failing to effectively control VOC pollution, and was reprimanded by Sinopec Group. On April 1 this year, the Central Committee and the State Council issued a notice deciding to establish the **Hebei New Area**. On April 5, the Party leadership group of Sinopec held an enlarged meeting. Wang Yupu, chairman of Sinopec, stated that the company would take practical actions to support the planning and development of the **new district, fulfill its responsibilities as a central state-owned enterprise, and act in the interest of the overall situation. The content of this article is sourced from Caixin News, and has been organized and published by Shihua Yuan. 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This relocation project is quite complex, involving many aspects; it will probably require careful planning. However, the environmental capacity of Fangshan District has already reached its limit; water resources, pollution, and development are all major issues that need to be addressed.