Construction work for the 1.6 million tons per year ethylene plant of CNOOC Shell Huizhou Phase III ethylene project has commenced
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The total investment is approximately 52.1 billion yuan! Construction and installation work begins for CNOOC Shell Huizhou Phase III ethylene project On May 28, 2025, the CNOOC Shell Huizhou Phase III ethylene project held a ceremony to mark the start of the construction and installation works for the 1.6 million tons per year ethylene production facility. CNOOC Shell Huizhou Phase III Ethylene Project will construct 1.6 million tons per year of ethylene, along with a total of 16 downstream chemical processing units, as well as utility systems and supporting facilities. Upon completion of the project, CNOOC Shell’s ethylene production capacity will reach 3.8 million tons per year, allowing it to retain its status as the largest ethylene monomer plant in China, with significant economies of scale. This project will also be integrated and optimized with the existing chemical and refining Phase I and II projects, further enhancing the level of integration in refining and chemical processing as well as improving resource utilization efficiency. This project introduces a number of process technologies that are used for the first time in Asia and within China. Seven of these units utilize Shell’s proprietary technologies, and they are capable of supplying over 5 million tons of chemical products to the market each year, including metallocene polyethylene and polypropylene. This will help meet the domestic demand for high-end chemical products and facilitate the advancement of China’s chemical industry toward the higher end of the global value chain. At the same time, through measures such as optimizing the project scope and electrifying large-scale compression units, this project will achieve an overall 20% reduction in carbon dioxide emissions, promote the use of renewable green energy, and contribute to the implementation of the **\"Dual Carbon\" strategy. The total investment for CNOOC Shell Huizhou Phase III ethylene project is approximately 52.1 billion yuan. With a 1.6 million tons per year ethylene cracking unit as the core, 18 chemical processing units, utility systems, and supporting facilities will be constructed. This includes a 1.6 million tons per year ethylene plant, a 305,000 tons per year butadiene extraction plant, a 1.46 million tons per year pyrolysis gasoline hydrogenation plant, an 1.1 million tons per year aromatic extraction plant, a 645,000 tons per year ethylene oxide-ethylene glycol (EO-EG) plant, a 600,000 tons per year metallocene linear low-density polyethylene (mLLDPE) plant, a 400,000 tons per year linear α-olefin (LAO) plant, a 130,000 tons per year isomerization and disproportionation (ID) plant, a 130,000 tons per year Shell hydroformylation (SHF) plant, a 50,000 tons per year polyα-olefin (PAO) plant, a 500,000 tons per year polypropylene (PP) plant, a 1 million tons per year ethylbenzene (EB) plant, an 875,000/400,000 tons per year styrene-propylene oxide (SM-PO) plant, a 450,000 tons per year polyether polyol (DMC-POD) plant, a 100,000 tons per year polymer polyol (POP-POD) plant, a 270,000/80,000 tons per year MTBE/butene-1 plant, along with supporting storage and transportation facilities, utility systems, auxiliary facilities, and environmental protection systems. On December 3, 2024, the IMPT team for the Phase III ethylene project of CNOOC Shell held a kick-off meeting for the 1.6 million tons per year ethylene plant project at Sinopec Engineering Co., Ltd. (SEI) in Beijing, marking the official launch of this largest ethylene production facility under construction in China.
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From Phase 1 to Phase 3, CNOOC Shell has been established in the Daya Bay Petrochemical Zone for over 20 years, acting like a brilliant pearl in the South China Sea. By leveraging the \"banyan tree effect\" and its role as a leading enterprise in the industry, it has attracted more than 10 world-renowned and industry-leading companies such as BASF, Clariant, and Mitsubishi Chemical to settle in this petrochemical zone, resulting in a concentration of numerous enterprises from various stages of the industrial chain in one place. The olefins and their derivatives produced by CNOOC Shell are supplied to the market as basic chemical raw materials; over 80% of these products are delivered to the market in the Guangdong-Hong Kong-Macao Greater Bay Area. They are also supplied via pipelines to nearly 20 corporate customers within the Daya Bay Petrochemical Complex. CNOOC Shell’s diverse and high-quality products are widely used in agriculture, industry, construction, and the pharmaceutical sector, as well as in consumer goods such as automobiles, home furnishings, electronics, and personal care products. The company is committed to fulfilling its mission of \"using petrochemicals to contribute to a better life.\" Yuxin Co., Ltd., which is located adjacent to CNOOC Shell, obtains a sufficient and convenient supply of raw materials through pipelines. Since establishing itself in Daya Bay in 2009, Yuxin Co., Ltd. has focused on the deep processing of LPG (liquefied petroleum gas), and has grown into a large-scale, technologically advanced carbon tetrahydrocarbons processing enterprise with a complete industrial chain in South China. Currently, Yuxin Co., Ltd. has two companies in the Daya Bay Petrochemical Zone: Huizhou Yuxin Chemical Co., Ltd. and Huizhou Yuxin New Materials Co., Ltd.; it also has Huizhou Bokewang Environmental Protection New Materials Co., Ltd. in the Huizhou New Materials Industrial Park. Several companies supply raw materials to one another, forming upstream and downstream industrial chains that further extend the butane chain. Clariant, one of the world’s top 50 chemical companies, also followed CNOOC Shell and, by relying on CNOOC Shell for the supply of raw materials, invested in the Daya Bay Petrochemical Complex to build the largest ethylene oxide derivative factory in the Asia-Pacific region (with an annual production capacity of 100,000 tons). Over the past 15 years since its establishment in Daya Bay, Clariant Huizhou has invested a total of around 1.8 billion yuan there. In the past five years, it has continued to increase its investments; at the end of 2021, it launched the \"High-Performance Halogen-Free Flame Retardant Materials Project (Phase I)\", and in June 2023, it successfully completed the first batch of trial production ； The \"High-Performance Surfactants\" and \"High-Performance Halogen-Free Flame-Retardant New Materials Expansion Project (Phase II)\\" were launched in December 2022, with production set to begin gradually in the first half of 2025. Large projects drive significant development. To this day, along the shores of Daya Bay, surrounded by lush mountains and blue seas, a multitude of petrochemical giants have gathered here. This \"industrial forest\" is home to 13 companies from the Fortune Global 500 list, including CNOOC, Shell, ExxonMobil, Hengli, Mitsubishi Chemical, LG Chem, and BASF, resulting in a total investment of 325.2 billion yuan. It represents a scenario where state-owned, foreign, and private enterprises compete and develop together. As the core of the \"Pan-Greater Bay Area Industrial Cluster\" among the \"five world-class petrochemical industry clusters\" planned by the Petrochemical Federation, and as the only petrochemical industry base in Guangdong Province to be selected for **priority development (out of seven nationwide), Daya Bay Development Zone has ranked first among China’s top 30 chemical parks for six consecutive years (from 2019 to 2024). At present, the Daya Bay petrochemical complex has an annual production capacity of 22 million tons of refined oil, 3.8 million tons of ethylene, 2.5 million tons of aromatics, and 5 million tons of PTA. These figures represent 25%, 54%, 50%, and 68% of the province’s total production respectively. Its scale of integration in petrochemical processing ranks among the top in the country, enabling the development of competitive industrial chains for carbon dioxide, carbon three, carbon four, carbon five, and carbon nine compounds.
Project History: In the late 1980s, Huizhou began its efforts to secure the establishment of CNOOC Shell’s “Nanhai Petrochemical” project (Phase 1). Through the continuous efforts of several successive leadership teams, in November 2002, the South China Sea Project was inaugurated at the site of the Daya Bay Project, marking the official launch of China’s largest Sino-foreign joint venture at that time; it became the first petrochemical enterprise to operate in the park. In January 2006, the first phase of the project was successfully put into operation. This project incorporates 13 world-class patented technologies, including Shell’s proprietary technologies. It integrates the management practices and best practices of both Shell and CNPC, adopts management systems and practices in line with international standards, and adheres to the principles of sustainable development to build a modern petrochemical complex in Daya Bay that is safe, reliable, environmentally friendly, and efficient – all in a responsible manner. Since then, the Daya Bay petrochemical zone has entered the fast track of \"major projects driving substantial development.\" Driven by this project, in less than 5 years the petrochemical industry has developed into one of the two key industries in Huizhou. In December 2014, the second phase of CNOOC Shell project commenced construction, and it was officially put into operation in April 2018. After the project was put into operation, CNOOC Shell’s ethylene production capacity increased to 2.2 million tons per year, making it one of the largest ethylene producers in China. This also marked Daya Bay Petrochemical Zone as the largest petrochemical industry complex in the country in terms of integrated refining and chemical production capabilities. In October 2018, CNOOC and Shell jointly signed a memorandum of understanding for the Huizhou Phase III ethylene project ； In May 2020, the strategic cooperation framework agreement signing ceremony for Huizhou’s Phase III ethylene project was held virtually in Guangzhou, Beijing, and The Hague, the Netherlands ； In May 2022, the Phase 3 ethylene project in Huizhou was approved by the Guangdong Provincial Development and Reform Commission ； In March 2023, the preliminary investment agreement for Huizhou’s Phase 3 ethylene project was signed ； In May 2023, the project held a groundbreaking ceremony in Daya Bay, Huizhou ； In November 2023, a public notice was issued regarding the acceptance of the project’s environmental impact assessment report ； On December 31, 2023, the Guangdong Provincial Energy Bureau issued its review opinions on the project’s energy conservation report, approving it ； On February 23, 2024, the website of the Guangdong Provincial Department of Ecology and Environment published a notice regarding the acceptance of the project’s environmental impact assessment report ； Construction is tentatively scheduled to begin on July 20, 2024; the trial pile construction will be completed by August 20, 2024, with a total project duration of approximately 149 days ； On November 20, 2024, the first progress meeting for CNOOC Shell Huizhou Phase III ethylene project was held, marking the official launch of the project as it enters the stage of full-scale construction ； On December 3, 2024, the IMPT team for the Phase III ethylene project of CNOOC Shell held a kick-off meeting for the 1.6 million tons per year ethylene plant project at Sinopec Engineering & Construction Co., Ltd. in Beijing, marking the official launch of this largest ethylene production facility under construction in China ； According to a report dated December 18, 2024, China Chemical Donghua Technology won the bid for the EPC contract related to the design, procurement, and construction of the wastewater treatment facility for the Phase 3 ethylene project at CNOOC Shell Huizhou, with the bid amount totaling 558 million yuan ； In January 2025, the third-phase ethylene project and the polycarbonate project at CNOOC Shell Huizhou both reached their final investment decisions and entered the phase of full-scale construction ； On May 28, 2025, the civil construction and installation project for the 1.6 million tons per year ethylene plant of CNOOC Shell Huizhou Phase III was launched.
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