【Tour of Overseas Petrochemical Projects】Hengyi Brunei PMB Petrochemical Project – The First Overseas Petrochemical Project Adhering to Chinese Standards
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The last edit to this post was made by Desert Fish on December 4, 2021, at 20:24. Hengyi Petrochemical: Brunei’s PMB petrochemical project has gone into full operation. According to a report in The Beijing News (reporter: Zhao Ze), on the evening of November 3, 2019, Hengyi Petrochemical announced that its refining and chemical processing plant in Brunei, after completing all necessary tests, trials, and periods of stable operation, had achieved full operational capacity on November 3, successfully producing products such as gasoline, diesel, aviation kerosene, PX, and benzene. This marked a successful first trial run of the Brunei refining and chemical processing plant. The announcement states that the company’s holding subsidiary, Hengyi Industrial (Brunei) Limited, has invested in the construction of the “PMB Petrochemical Project” on Pulau Muara Besar in Brunei Darussalam. After thorough testing, commissioning, and stable operation, the plant was able to operate at full capacity on November 3, successfully producing products such as gasoline, diesel, aviation kerosene, PX, and benzene, which marks a successful first trial run of the Brunei Petrochemical Project. At present, the refining and petrochemical project in Brunei is operating stably, with all products meeting quality standards; it has entered the commercial operation phase and is expected to increase its production capacity to full level in a relatively short time. The announcement states that the Brunei refining project completed the handover of utility works in March this year ； Full handover of the main unit was completed in July, and that same month all units entered the joint commissioning phase ； In September, the atmospheric and vacuum distillation unit produced qualified intermediate products. The company states that the successful commissioning of the Brunei refining project not only eliminates the risks associated with uncertainties during the construction phase of overseas projects, but the project also boasts significant advantages, allowing it to benefit from tax incentives for up to 24 years ； Crude oil is easily available for procurement, while refined products can be consumed locally in Brunei or sold in Southeast Asia nearby ； The cost advantages of utility services and production facilities are significant, resulting in a substantial reduction in the unit production cost ； It also enjoys natural geographical advantages, resulting in significant savings on transportation costs at both the production and sales ends.
On September 15, 2020, Hengyi Petrochemical announced that its subsidiary, Hengyi Industry (Brunei) Limited (hereinafter referred to as Hengyi Brunei), intended to invest in the construction of Phase 2 of the PMB petrochemical project in Brunei. Hengyi Petrochemical stated that the total investment for this second-phase project is estimated at 13.654 billion US dollars (approximately 92.432 billion yuan). The project funding will come from Hengyi Petrochemical’s own funds, bank loans, or other financing methods. The announcement states that the construction period for this second-phase project is three years, with an internal rate of return of 18.67% and a payback period of 7.25 years. Upon completion of the project, Hengyi’s plant in Brunei will generate an additional annual revenue of 11.045 billion US dollars (approximately 74.77 billion yuan), with an average annual increase in net profit of 1.716 billion US dollars (approximately 11.617 billion yuan). The second phase of Brunei’s refining and petrochemical project consists mainly of four components: refining, aromatics, ethylene, and polyesters. It includes a refining capacity of 14 million tons per year, 2 million tons per year of p-xylene, 2.5 million tons per year of purified terephthalic acid (PTA), 1 million tons per year of polyethylene terephthalate (PET), 1.65 million tons per year of ethylene, along with associated storage and transportation facilities, utility systems, and various supporting infrastructure.
In November 2019, the 8 million-ton petrochemical processing project at Hengyi Petrochemical’s PMB facility in Brunei was successfully put into operation, marking the complete establishment of the company’s integrated upstream and downstream industrial chain covering refining, PX, PTA, and polyester production. Hengyi Brunei Refining & Petrochemical is a key project under China’s Belt and Road Initiative. Located on Pulau Damai in Brunei Darussalam, its total investment amounts to 3.445 billion US dollars. Hengyi Limited and the Brunei **Industrial Fund hold 70% and 30% of the shares respectively, with Hengyi Petrochemical holding the management rights. Of the 8 million tons of crude oil, 3 million tons are Brunei light oil, 3.3 million tons are Qatar crude oil, and 1.7 million tons are Middle Eastern condensate. The project is planned to produce 1.5 million tons of PX, 480,000 tons of benzene, 2.62 million tons of gasoline, 1.17 million tons of aviation kerosene, 1.74 million tons of diesel, and 560,000 tons of LPG per year. In addition to meeting local demand in Brunei, the refined oil and gas products are sold in Southeast Asia; 1.5 million tons of PX can meet the company’s own PTA needs. In addition, a memorandum of understanding was signed in September 2017 for Brunei Phase II’s 14-million-ton refining and chemical project, which is planned to produce 1.5 million tons of ethylene and 2 million tons of PX; once operational, it will further reduce the unit production cost.
Hengyi’s PMB project in Brunei started off on a quite strong footing, serving as a model in Southeast Asia.
It is a great collaboration of Chinese capital and technology, along with foreign resources and foreign markets