Apart from Hengli Petrochemical, these nine major domestic refining and chemical companies are worth paying attention to in 2021!

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On the evening of April 5, 2021, the performance report released by Hengli Petrochemical sent shockwaves through the refining and petrochemical industry. In 2020, Hengli Petrochemical achieved another record in terms of performance, with operating revenue reaching 152.397 billion yuan, a year-on-year increase of 51.21% ； The net profit attributable to the shareholders of the listed company was 13.462 billion yuan, representing a year-on-year increase of 34.29%. The competitiveness of large-scale integrated refining and chemical complexes becomes evident. Besides Hengli, which other refining and petrochemical companies are worth paying attention to? 01 Dalian Hengli Petrochemical: Founded in 1994, Hengli Group focuses on its core business and adheres to the real estate sector; it is an international enterprise that develops the entire industrial chain involving oil refining, petrochemicals, polyester new materials, and textiles. The group currently owns one of the world’s largest PTA plants in terms of production capacity, as well as one of the largest production bases for functional fibers and textile manufacturing enterprises in the world. It employs over 100,000 people and has established a \"Corporate Technology Center.\" Both the company’s competitiveness and its product brand value rank among the top in the international industry. As China’s first modern refinery built in one go with a capacity of over 20 million tons, Hengli Refining & Chemicals boasts internationally leading and domestically top-tier process technology as well as large-scale processing facilities. It possesses industry-specific supporting capabilities that are difficult to replicate in China and are highly comprehensive, giving it significant competitive advantages in the sector. This has made it the main source of the company’s profits and the driving force behind its performance growth. In 2020, following the commissioning of the Hengli refining project last year, this year will also be the second major year for Hengli Petrochemical to expand its production capacity across the entire industrial chain, and it represents a crucial period for completing the development of that entire chain. A glimpse at Dalian Hengli Petrochemical’s integrated refining and chemical processing project: All the raw materials for the company’s ethylene production are supplied by a refinery with a capacity of 20 million tons, located upstream. The ethylene production facility is the largest of its kind in the world, with an ethylene yield of 48%, the highest rate in China. This setup takes full advantage of the scale advantages associated with integrated refining and chemical processing, enabling the production of various high-value chemical products that are in short supply in China (including 1.8 million tons of ethylene glycol, 720,000 tons of styrene, 423,000 tons of polypropylene, 400,000 tons of high-density polyethylene, and 140,000 tons of butadiene). This will significantly enhance the integrated deep-processing capabilities and the added value of Hengli’s refinery products. 02 Zhejiang Petrochemical: The 40 million tons per year integrated refining and chemical processing project of Zhejiang Petroleum Chemical Co., Ltd. is located within the Zhoushan Green Petrochemical Base in Zhejiang Province, and it is one of the key projects under the development of the China (Zhejiang) Free Trade Zone. It is a joint-stock company established with capital contributions from Rongsheng Petrochemical, Zhejiang Juhua, Zhejiang Tongkun, and Zhoushan Marine Comprehensive Development Investment Co., Ltd. The registered capital of this project is 23.8 billion yuan, with a total investment of 173 billion yuan. The project is divided into two construction phases; each phase is capable of processing 20 million tons of crude oil per year, producing 5.2 million tons of aromatics and 1.4 million tons of ethylene per year. On December 30, 2019, Rongsheng Petrochemical issued a announcement stating that the 40 million tons per year integrated refining and chemical processing project (Phase I) had been put into full operation. Rongsheng Petrochemical announced that the \"40 million tons per year integrated refining and chemical processing project (Phase I)\", which was built by the company’s holding subsidiary Zhejiang Petrochemical Co., Ltd. (hereinafter referred to as \"Zhejiang Petrochemical\") in the Zhoushan Green Petrochemical Base, brought its first batch of facilities into operation in May 2019 – these facilities included units for vacuum distillation and related utility systems. The commissioning of this project will, on the one hand, help the company establish an integrated industrial chain that covers crude oil – aromatics (PX), olefins – PTA, MEG – polyester – spinning – elasticization, thereby enabling high-quality and efficient large-scale production, reducing product costs, further enhancing the company’s profitability, improving its overall strength and risk resistance, and facilitating leapfrog development ； On the other hand, it will improve China’s influence in the aromatics and ethylene industries to a certain extent, boost the production, processing, and sales of mid- and downstream chemical products, and thereby achieve economic and social benefits for the company. 03 Shenghong Refining & Chemical: Shenghong Group is a large-scale enterprise group in China, established in 1992 with its headquarters located in Shengze, Wujiang, Jiangsu Province. On December 14, 2018, the 16 million tons per year integrated refining and chemical processing project of Shenghong was officially launched. This project will adopt the most advanced technologies available both domestically and internationally, break the monopoly held by foreign products, enhance China’s influence in the global petrochemical industry, and strive to become a world-class refining and chemical processing project capable of representing ** in international competition. The scale of the Shenghong refining and chemical integration project is as follows: 16 million tons per year of oil refining capacity, 2.8 million tons per year of p-xylene production, 1.1 million tons per year of ethylene and its downstream derivatives; it also includes a crude oil terminal with a capacity of 300,000 tons, 4 liquid chemical terminals with a capacity of 50,000 tons each, as well as a storage facility with a capacity of 3 million cubic meters and utility islands. The total investment in the project is approximately 67.7 billion yuan. Once completed, it is expected to generate annual operating revenues of around 92.5 billion yuan, as well as profits and taxes exceeding 20 billion yuan. This will effectively contribute to the development of the Lianyungang petrochemical industry base, as well as to the adjustment and upgrading of its industrial structure. The total investment in the Shenghong refining and chemical project is approximately 77.5 billion yuan, with an annual capacity to process 16 million tons of crude oil. It is expected to be completed and put into operation by 2021, at which time it will be able to generate an annual output value of around 120 billion yuan and profits and taxes exceeding 20 billion yuan. This will help the group develop a complete new high-end textile industry chain consisting of \"crude oil – aromatics – PTA – polyester – fibers\", as well as a distinctive petrochemical industry chain based on \"crude oil + alcohols – olefins – fine chemicals\". These two industry chains will support Shenghong’s efforts to make it part of the world’s top 500 companies. 04 Gulei Petrochemical: Fujian Gulei Petrochemical Co., Ltd. (hereinafter referred to as “Gulei Petrochemical”) was established on November 3, 2016, with Fujian Refining & Chemical Co., Ltd. and Xuteng Investment Co., Ltd. each contributing 50% of the capital. The company’s inauguration ceremony was held in Xiamen on November 7 of the same year, during the Cross-Strait Entrepreneurs Summit. Among them, Fujian Refining & Chemical Co., Ltd. is a large-scale petrochemical enterprise jointly established with 50% investment each by Fujian Province and Sinopec. The Gulei refining and chemical integration project is located in the Gulei Petrochemical Base within the Gulei Port Economic Development Zone in Zhangzhou, Fujian. Phase 1 covers an area of 8,200 mu, with an planned investment of 27.88 billion yuan. Initially, it will involve the construction of an ethylene cracking plant with an annual capacity of 800,000 tons, as well as 9 downstream chemical processing units and the associated utility facilities. There will also be 2 berths with a capacity of 50,000 tons each, 1 berth with a capacity of 20,000 tons, and 2 berths with a capacity of 5,000 tons each. Next, 16 million tons of refining capacity and 1 million tons of ethylene production capacity will be added. 05 Hengyi Brunei Petrochemical Project: The Hengyi (Brunei) PMB Petrochemical Project is a major project under China’s Belt and Road Initiative; it is an integrated oil refining and petrochemical complex with a capacity of tens of millions of tons, jointly developed by our company and Brunei. The project is located in Brunei Darussalam. The total investment for the first phase is approximately $3.45 billion. Leveraging Brunei’s abundant oil resources and favorable investment climate, and by utilizing the world’s most advanced petrochemical technologies, the project will include facilities with a capacity of 8 million tons per year for atmospheric and vacuum distillation, 2.2 million tons per year for hydrocracking, 1.5 million tons per year for aromatic compounds production, 2.2 million tons per year for diesel hydrogenation, 1.3 million tons per year for kerosene hydrogenation, and 1 million tons per year for flexible coking. In addition, there will be supporting utilities such as power plants, docks, tank farms, and seawater desalination facilities. On November 3, 2019, following comprehensive testing, commissioning, and steady operation, the Hengyi Brunei PMB petrochemical project (hereinafter referred to as the “Hengyi Brunei PMB Project”) achieved full operational capability across all its processes. On the evening of October 25, 2020, Hengyi Petrochemical (000703) released its third-quarter report, which showed that in the first three quarters of that year the company achieved revenue of 61.321 billion yuan, with a net profit attributable to the parent company of 3.057 billion yuan – a year-on-year increase of 38.09%. 06 CNOOC Shell: CNOOC Shell Petrochemical Co., Ltd. (CNOOC Shell) was established in 2000 and is one of the Sino-foreign joint venture petrochemical enterprises with the largest investment volume in China. The investors are China National Offshore Oil Corporation, Royal Dutch Shell Group, and Guangdong Guangye Investment Group Co., Ltd.; each party holds a 50% stake. At 4 p.m. on May 17, 2020, the strategic cooperation framework agreement for CNOOC Shell Huizhou Phase III ethylene project was signed virtually simultaneously in Guangzhou, Beijing, and The Hague, the Netherlands. The total investment in this project is approximately 5.6 billion US dollars (about 39.6 billion yuan), and it is located in Daya Bay. CNOOC, Shell Group, and Huizhou in Guangdong have once again joined forces. Their cooperation began in the 1990s with the Sino-foreign joint venture project of that era – the CNOOC Shell Nanhai Petrochemical Project. To date, the first and second phases of this project have been completed and put into operation; they constitute China’s largest ethylene production facility and are also Shell’s most profitable plant worldwide. With an ethylene production capacity of 2.2 million tons per year, these facilities are able to supply the market with over 6 million tons of high-quality, diversified petrochemical products each year. 07 Sinochem Quanzhou Petrochemical: Sinochem Quanzhou Petrochemical Co., Ltd. is located in Quanzhou City, Fujian Province. Established in September 2006, it is a wholly-owned subsidiary of China Sinochem Group Corporation (hereinafter referred to as “Sinochem”). The company is responsible for the construction and operation of Sinochem’s 12 million tons per year oil refining project, as well as subsequent expansions and upgrades to this facility, as well as the 1 million tons per year ethylene production project. The Sinochem Quanzhou Refining and Chemical Integration Project (Phase II) has a total investment of around 32.5 billion yuan. Building on the existing 12 million tons per year refining facility that is already in operation, 13 new refining and chemical units will be constructed or upgraded, along with related storage, transportation, port, and utility facilities. This will raise the crude oil processing capacity to 15 million tons per year. Additionally, a 1 million tons per year ethylene production facility will be built (including 800,000 tons per year of aromatics). The project is located in the Quanhui Petrochemical Industrial Zone (Dongqiao Town), Hui’an County, Quanzhou City, Fujian Province, covering an area of approximately 6,541 mu. The process units and scale of the project consist of 11 units in the chemical processing area, including an ethylene cracking unit with a capacity of 1 million tons per year, an EVA unit with a capacity of 100,000 tons per year, an HDPE unit with a capacity of 400,000 tons per year, EO/EG units with capacities of 200,000/500,000 tons per year, PO/SM units with capacities of 200,000/450,000 tons per year, a PP unit with a capacity of 350,000 tons per year, a butadiene extraction unit with a capacity of 120,000 tons per year, MTBE/butene-1 units with capacities of 100,000/30,000 tons per year, a pyrolysis gasoline hydrogenation unit with a capacity of 500,000 tons per year, an aromatic extraction unit with a capacity of 350,000 tons per year, and a p-xylene unit with a capacity of 800,000 tons per year ； There are 2 sets of units for oil refining, including a newly built atmospheric distillation unit with a capacity of 3 million tons per year and a refinery dry gas pre-purification unit with a capacity of 450,000 tons per year. 08 Wanhua Chemical: Wanhua Chemical (Yantai) Petrochemical Co., Ltd. was established on April 20, 2015, and is a wholly-owned subsidiary of Wanhua Chemical Group Co., Ltd. The company is primarily responsible for the supply and distribution of the key raw materials and petrochemical products required by the petrochemical industry chain in Wanhua Yantai Industrial Park. The company’s demand for liquefied propane is 900,000 tons per year, and its demand for mixed butane is 600,000 tons per year ； Annual sales will amount to 200,000 tons of propylene, 260,000 tons of propylene oxide, 820,000 tons of MTBE, 440,000 tons of acrylic acid and esters, 100,000 tons of n-butanol, and 40,000 tons of NPG. The company’s products are widely used in industries such as coatings, superabsorbent resins, gasoline additives, and polyester resins. The company is committed to providing high-quality services to its customers, and aims to become the most trusted business partner in the domestic C3/C4 industrial chain basic chemicals and their derivatives sector – one that is both highly competitive domestically and has international influence. Wanhua Petrochemical uses a propane-based chemical production route; with its existing propylene integration facility and the ethylene integration facility under construction, the total amount of propane processed will exceed 3 million tons, making it the largest propane-based chemical production base in China. Propane is used in chemical manufacturing, and can be processed through two routes: dehydration and cracking. Propane dehydrogenation (PDH) uses propane as the sole raw material, with propylene being the almost exclusive product; Wanhua’s propylene integration process follows the PDH route. Propane is generally used for cracking when it is particularly cost-effective; some propane is mixed into naphtha as a feedstock for cracking, resulting in a complex product composition. In contrast, the ethylene integration project being built by Wanhua uses propane as the sole feedstock for cracking, with the main products being ethylene and propylene. 09 Yulong Petrochemical: Shandong Yulong Petrochemical Co., Ltd. completed its business registration in June 2019. The Yulong Island refining and petrochemical integration project (Phase I) is located on Yulong Island in Longkou City, Yantai Province, Shandong Province; it is led by Nanshan Group and is planned as a refining and petrochemical integration project with an annual capacity of 40 million tons. On the afternoon of October 24, 2020, Shandong Province held an event to launch a large number of major projects simultaneously, with 496 such projects starting construction at that time. The Yulong Island refining and chemical integration project commenced simultaneously, along with the signing of agreements for related supporting projects. The Yulong Island refining and chemical integration project (Phase I) is located on Islands 2# and 3# of Yulong Island in Longkou, Yantai City, Shandong Province. The investment required for the construction of this project is approximately 127.4 billion yuan, with a construction period of 24 months. The project plans to establish a crude oil processing capacity of 20 million tons per year, and will be equipped with a atmospheric distillation unit capable of processing 10 million tons per year, a vacuum distillation unit also capable of handling 10 million tons per year, units for light hydrocarbon recovery, desulfurization and dewaxing facilities, as well as residue hydrogenation units among other refining processes. It will also include chemical processing units for producing ethylene, hydrogenating cracked gasoline, carrying out aromatic extraction, butadiene extraction, and producing EVA/LDPE. In addition, there will be supporting utility systems, auxiliary facilities, as well as seawater desalination and intake/drainage systems. 10 Dongming Petrochemical Group: The Shandong Dongming Petrochemical Group was established in 1987. It currently has 7,000 employees and total assets of 30 billion yuan. Its annual processing capacity for crude oil is 15 million tons. It is a mega petrochemical enterprise group with diversified ownership, integrating activities such as crude oil processing, petrochemical production, chlor-alkali manufacturing, fine chemical production, natural gas chemical processing, engineering services, real estate development, the sale of refined oil and gas, international finance, international trade, international investment, international logistics, infrastructure development, and culture and education. It ranked 188th among China’s top 500 enterprises in 2019, 81st among China’s top 500 manufacturing enterprises, 55th among China’s top 500 private enterprises, 11th among China’s top 500 petroleum and chemical enterprises, and 5th among Shandong’s top 100 private enterprises. When it comes to refining, many people’s first thought is likely the Jinan Oil Refinery. However, this refinery belongs to Sinopec and is not part of Shandong’s local refineries; the largest of these local refineries is Dongming Petrochemical, which ranked 55th on China’s list of the top 500 private enterprises in 2019, indicating its considerable strength. Source: my Xiaobin