News related to CASIC: Total participates in CASIC’s refining project

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Total Participates in Sino-University Refining Project Author: | Source: Yicai Daily | Date: 2012-3-30 [Large Medium Small] The French company Total, which has recently been dealing with problems related to gas well leaks, announced yesterday that it is currently a shareholder in this large-scale integrated refining project jointly developed by Sino-University, holding a stake of around 19% to 20% in it. Additionally, Nu Beitang, Total’s general representative in China, revealed in an interview with a reporter from Yicai Daily yesterday that the company hopes to pursue comprehensive cooperation with Sinopec in the area of retail gasoline stations. 　　The CUET Refining Project is one of the largest petrochemical joint ventures in China. It attracted considerable attention due to location issues, and it is now located in Zhanjiang, Guangdong. It is understood that the project includes 15 million tons of refining capacity and 1 million tons of ethylene production capacity, with an initial investment estimate of around 53 billion RMB. 　　Based on the latest shareholding structure, in the refining and chemical joint venture, Total, Kuwait Petroleum, and Sinopec (600028) hold 20%, 30%, and 50% of the shares respectively ； In the marketing joint venture, the shareholdings of the three companies are 19.75%, 29.25%, and 51% respectively. 　　Or use chemical products to offset the losses from oil refining. Once the aforementioned joint venture reaches full production capacity, together with Dalian Xipacific (601099) Petrochemical Co., Ltd., which already holds a stake of about 25%, Total will have two integrated oil refining and chemical processing companies in China. However, last year, China Petroleum (601857) and Sinopec’s refining operations incurred losses across the board, with losses of 60.1 billion yuan and 37.6 billion yuan respectively. 　　And what was the reason behind Total’s entry into the refining project at this time? 　　Nubei Tang told reporters that in China, refineries can remain profitable when the price of crude oil is 80 dollars per barrel; however, when the price ranges from 80 to 120 dollars per barrel, things get difficult for them. Once the price of crude oil exceeds 120 dollars per barrel, refineries start to incur losses. “Therefore, if a joint venture for a refining project is to be established, it is necessary to get involved in the production and sales of chemical products. ” 　　Taking Sinopec as an example, although its refining business incurred heavy losses last year, the company still managed to achieve a net profit of 71.7 billion yuan thanks to improved performance in areas such as crude oil, chemicals, and downstream marketing. 　Among them, the production and sales of the chemical industry sector saw a significant increase, reaching a record high; the operational revenue amounted to 26.7 billion yuan, an increase of 78.1% compared with the previous year. 　　Gas station projects will slow down. “Another important business area for us, along with Sinopec and Kuwait Petroleum Corporation, is the marketing of refined petroleum products at the downstream stage.” ”Nubei Hall said that this was also one of the original intentions behind its company’s collaboration with two other partners. 　　Previously, Total and Sinochem had already partnered up 6 years ago, operating under the name \"Sinochem Total\" to carry out downstream retail operations in refined oil products in China. However, Nu Beitang said that this joint venture has not yet obtained the rights to wholesale refined oil, which is why progress has been slow. Currently, the only foreign company with the right to wholesale gasoline and diesel in the country is ExxonMobil. 　　Furthermore, the reporter learned that Sinochem Group’s limited own resources of refined oil are also one of the reasons for the slow progress of this joint venture project. 　　Nubei Tang noted that Total’s original goal was to build 500 to 600 gas stations in China together with Sinopec, of which 300 were to be located in the Yangtze River Delta region. But now it might be only around 150 companies in total, “with 5 in Shanghai.” ” 　　In contrast, BP has already partnered with Sinopec and CNPC to operate 800 \"dual-brand\" joint venture gas stations in regions such as Guangdong and Zhejiang ； And Shell also has over 300 gas stations