REFINERY NEWS ROUNDUP: Maintenance accelerates in China

London — A number of refineries in China are starting or planning to carry out works in the second quarter.

China independent refiners' appetite for crude and bitumen blend saw modest monthly growth in March following the easing of congestion at Shandong port, and inflows are expected to maintain similar momentum in the coming months as more refineries go offline for maintenance. In April, a combined 10.5 million mt/year of refining capacity will be shut at four Shandong facilities, bringing total offline capacity to 12.8 million mt/year. This trend is expected to continue in May-June, sources said. But there was still uncertainty over shutdown schedules as refineries have been very flexible with their maintenance plans. The 2.2 million mt/year Kelida Petrochemical, for example, has postponed its maintenance plan sometime from April to March.

Meanwhile, state-owned PetroChina's flagship refinery Dalian Petrochemical in northeastern Liaoning province, will reduce gasoil exports by 16.7% from March, according to a source with knowledge of the matter. The planned gasoil exports for April will be 200,000 mt, compared with 240,000 mt last month, while the April gasoline and jet fuel exports will be largely unchanged at 280,000 mt and 120,000 mt, respectively, from last month. Dalian will also increase its run rate to around 86% of its nameplate capacity in April, compared with 76% last month. This means the refinery will process 1.45 million mt of crude, up from 1.33 million mt, with most of the incremental volume coming from ESPO.

PetroChina's Guangxi Petrochemical refinery plans to increase its gasoline exports by 25% month on month to 180,000 mt in April, a refinery source said April 8. The refinery's gasoline exports had climbed four times higher to 144,000 mt in March, from 36,000 mt in February, on the back of relatively good margins. On the other hand, exports of gasoil and jet fuel will be largely stable from March, at around 156,000 mt and 50,000 mt, respectively. In line with the higher gasoline exports, the refinery plans to raise its run rate by about seven percentage points in April to 84% of its nameplate refining capacity, or by cracking 830,000 mt of crude.

NEW AND ONGOING MAINTENANCE

UPGRADES

LAUNCHES

Near-term maintenance

New and revised entries

Japan

** Japan's largest refiner ENEOS said April 6 that it plans to resume waterborne and rack shipments of oil products other than fuel oil from the Wakayama refinery in the western Japan on April 8. For fuel oil, the date for resuming shipments has not yet been decided, a spokeswoman said. All units were shut at the Wakayama refinery after a fire broke out near the 39,000 b/d fluid catalytic cracker on March 29, and ENEOS suspended waterborne and rack shipments of oil products, a company official said earlier. It was not immediately clear when ENEOS would be able to restart the units, the spokeswoman said.

** Japan's ENEOS said April 8 it has delayed the restart of its Sendai refinery in Northeast Japan to mid-April, which has been suspended since the strong earthquake offshore Fukushima on Feb. 13. ENEOS initially planned to restart the Sendai refinery in the first half of April. However, another earthquake of magnitude 6.9 occurred off the coast of Miyagi Prefecture, northeast Japan, on March 20, after which ENEOS had suggested that it could delay the initial restart schedule due to the impact of the earthquake. A spokesman did not say why the restart was delayed to mid-April.

China

** Sinopec's Jiujiang Petrochemical in southern Jiangxi province, has shut its refinery since April 1 for a 45-day scheduled maintenance, according to its official Wechat account. This is the first time that the refinery has been shut for maintenance in the past four years, as the last maintenance was carried out in 2017. About 35 major units will be maintained during the shutdown, it said. Jiujiang Petrochemical has processed about 7.02 million mt of crude in 2020, about 20,000 mt higher than its initial target.

** PetroChina has shut its Fushun refinery in northeast China's Liaoning province since April 5, for a 50-day scheduled maintenance, according to its official Wechat account. The shutdown of the 8 million mt/year crude distillation units on April 5 kicked off the start of the maintenance, it said. The refinery last carried out a 45-day scheduled maintenance over June-July 2017 and expects to carry out the next maintenance five years later.

Existing entries

China

** PetroChina's Dagang Petrochemical will shut for maintenance over mid-May and end June.

** Sinopec's Qilu Petrochemical will shut a 4 million mt/year CDU for maintenance from mid-August till late September.

** Sinopec's Shijiazhuang Petrochemical will be shut for an overall maintenance over end-August till end-October.

** Sinopec's Jinan Petrochemical was shut end-February for maintenance until early April.

** CNOOC's Huizhou Petrochemical will shut the Phase 2 refinery of 10 million mt/year capacity for maintenance over March 4-April 22.

** Sinopec's Cangzhou Petrochemical will shut the entire refinery for maintenance over May 10-June 30.

** Sinopec's Yanshan Petrochemical will be shut for maintenance over May-June.

** Sinopec's Yangtze Petrochemical will shut some secondary units for maintenance over March-April.

** PetroChina's Jilin Petrochemical will shut for maintenance over May-June.

** Sinopec's Maoming Petrochemical will shut a 10 million mt/year CDU for maintenance over early-June till mid-July.

** Sinopec's Shijiazhuang Petrochemical will be shut for an overall maintenance over end-August till end-October.

** Sinopec's Guangzhou Petrochemical will shut a 8 million mt/year CDU for maintenance over mid-October-end November.

** Sinopec's Jinling Petrochemical has shut an 8 million mt/year CDU as well as some secondary units for about 40 days of maintenance since Nov. 18, 2020.

** Sinopec Shanghai Petrochemical will gradually shut its units for a scheduled full maintenance March 1, a company source said. It will shut the petrochemical units from March 1 while the refining units, including its two crude distillation units, will be shut from April 15, the source said. Sinopec Shanghai plans to complete the maintenance on June 8, the source added. In February, the refinery planned to process 1.2 million mt of crude oil, accounting for 98% of its capacity.

** Sinopec's Changling Petrochemical in central Hunan province is shut for a 55-day maintenance from around Feb. 19, the refinery said on its official WeChat platform. A total 47 maintenance projects will be carried out when the refinery is shut in February, including whole refining units and some petrochemical units, as well as public utilities. This will also be the first maintenance after the refinery has been operating for a long haul of four years. Prior to this, the refinery usually carries out works every three years. With the maintenance, the refinery planned to process 6.35 million mt of crude oil in 2021.

Japan

** A fire occurred at Japan's ENEOS Chiba complex during maintenance at midnight on March 5. The fire was extinguished shortly afterward and no one was injured. All units at the Chiba refinery were shut for regular maintenance on Feb. 5, and so far it is scheduled to resume operations in mid April.

** Japan's ENEOS said March 22 it plans to restart the fire-hit sole 136,000 b/d crude distillation unit at its Oita refinery in the southwest in August 2021. The restart of the Oita CDU comes after the investigative committee, including external experts, compiled a final report, which has been accepted by the relevant authorities. ENEOS, which has been transferring oil products from its other refineries in Japan to Oita, will consider the optimal run rate for the group's refineries in an effort to ensure stable supply, following this latest plan for the restart of its Oita CDU, a company spokeswoman said. A fire broke out at ENEOS' Oita CDU on May 26 last year during scheduled maintenance that had started on May 12.

** Japan's Cosmo Oil plans to shut the 75,000 b/d No. 1 crude distillation unit at its 177,000 b/d Chiba refinery in Tokyo Bay as well as the sole 100,000 b/d CDU at the Sakai refinery in western Japan for scheduled maintenance in autumn, a spokeswoman said Feb. 16. The works are expected to last about a month at both units, the spokeswoman added, but declined to add further details.

** Japan's ENEOS shut in late February the two crude distillation units at the Mizushima-B plant in western Japan for scheduled turnarounds. ENEOS' scheduled shutdown of the 95,200 b/d No. 2 crude distillation unit will last until late April, while the 105,000 b/d No. 3 CDU will shut until early June.

** Japanese refiner Fuji Oil plans to shut its sole Sodegaura refinery in Tokyo Bay for a large-scale regular maintenance from mid-May to end-June, a company spokesman said. The large-scale maintenance is carried out once every four years at the refinery, and is expected to last for more than a month, he added.

** Japan's largest refiner ENEOS said it will decommission the 120,000 b/d No. 1 CDU at its 270,000 b/d Negishi refinery in Tokyo Bay in October 2022, bringing down its total refining capacity to around 1.75 million b/d. ENEOS' latest move comes as it has been considering ways to optimize its refining system in Japan in the face of a sharp decline in domestic oil demand, accelerated by the coronavirus pandemic, amid increased competition in Asia. Under the latest development, it will also decommission secondary units attached to the No. 1 CDU, including a vacuum distillation unit and fluid catalytic cracker, the capacities of which were not immediately disclosed. ENEOS will also decommission a 270,000 mt/year lubricant output unit at the Negishi refinery.

** Due to the pandemic, Japanese refiner Taiyo Oil postponed works at Kikuma that would have involved shutting down the CDUs to 2021 or the year after to coincide with large-scale regular repairs.

Upgrades

Existing entries

** Sinopec's Changling Petrochemical in central Hunan province plans to start construction for its newly approved 1 million mt/year reformer this year and to bring its port upgrading project online by end-December, it said.

** Japan's second-largest refiner, Idemitsu Kosan, plans to start work on raising the residue cracking capacity at its 45,000 b/d FCC as it aims to increase LSFO output. Idemitsu Kosan's upgrade at the Chiba refinery was part of its response to the International Maritime Organization's global low sulfur mandate for marine fuels from January.

** China's Sinopec Luoyang Petrochemical expects the start-up of the 2 million mt/year CDU expansion to be delayed to H1 2021, a refinery source said.

** Axens said its Paramax technology has been selected by state-owned China National Offshore Oil Corp. for the petrochemical expansion at the plant. The project aims at increasing the high-purity aromatics production capacity to 3 million mt/year. The new aromatics complex will produce 1.5 million mt/year of paraxylene in a single train, Axens said. The Huizhou petrochemical complex has been operating an Axens Paramax complex since 2009 with 1.3 million mt/year of aromatics production.

** Construction of a new 1 million mt/year coker at Chinese independent refinery Haiyou Petrochemical, in eastern Shandong, has been put on hold, according to sources close to the refinery. The new coker was expected to come on stream in 2019.

** Sinopec's 21 million mt/year Jinling Petrochemical refinery in eastern China will build a new 600,000 mt/year vacuum distillation unit. It has reconfigured its No. 3 gasoline hydrotreater to a 360,000 mt/year hydrotreater to produce RMG 380 CST bunker fuel oil with sulfur content no higher than 0.5%.

** Sinopec's Zhenhai refinery in Ningbo, eastern Zhejiang province, has issued four tenders for preconstruction works of its 1.2 million mt/year ethylene expansion project. The project also include 15 million mt/year of refining capacity.

Launches

Existing entries

** China's private refining and petrochemical complex Zhejiang Petroleum & Chemical has started trial run in one of its two 10 million mt/year CDU in the phase 2, and is expected to commission the whole phase 2 (20 million mt/year) in 2021. Zhejiang Petroleum & Chemical's phase 3 project is unlikely to launch within the 14th Five Year Plan (2021-2025), market sources and analysts told S&P Global Platts.

** Honeywell said China's Shandong Yulong Petrochemical will use "advanced platforming and aromatics technologies" from Honeywell UOP at its integrated petrochemical complex. The complex will include a UOP naphtha Unionfining unit, CCR Platforming technology to convert naphtha into high-octane gasoline and aromatics, Isomar isomerization technology. When completed Yulong plans to produce 3 million mt/yr of mixed aromatics. Shandong's independent greenfield refining complex -- Yulong Petrochemical -- announced to start construction work at Yulong Island in Yantai city at the end of October, S&P Global Platts has reported previously. The construction work is expected to be completed in 24 months. The complex has been set up with the aim of consolidating the outdated capacities in Shandong province.

According to the preliminary schedule, a total of 10 independent refineries, with a total capacity of 27.5 million mt/year, will be mothballed over the next three years. The 10 refiners would also transfer all of their crude import quotas of 13 million mt/year to the new project in Yantai city, eastern Shandong province. Jinshi Petrochemical, Yuhuang Petrochemical and Zhonghai Fine Chemical are the first three refineries to be dismantled this year. Yuhuang Petrochemical and Zhonghai Fine Chemical have been in the process of dismantling, while Jinshi Asphalt has already finished. Major units to be constructed include two 10 million mt/year crude distillation units, two 1.5 million mt/year ethylene crackers, as well as other related units.

** Saudi Aramco has pulled out from a joint project to build a greenfield 300,000 b/d refining and petrochemical complex in northeast China, sources with direct knowledge of the matter told S&P Global Platts on Aug. 21. Aramco originally signed a deal with China's North Industries Group (Norinco) and Panjin Sincen to form Huajin Aramco Petrochemical Co. in February 2019, during a visit by Crown Prince Mohammed bin Salman to Beijing. The JV plans to build a $10 billion integrated refining and petrochemical complex in northeast China's Liaoning province Panjin city with a 1.5 million mt/year ethylene cracker and a 1.3 million mt/year PX unit.

** KBR said it has been awarded a contract for catalyst supply for a vinyl acetate monomer grassroots project at China's Shenghong (Lianyungang) refinery. The 300,000 mt/year unit is a "key intermediate" for the production of polymers and resins for adhesives, coatings, paints, films, textiles and other products. In 2019, the refinery started construction of its 16 million mt/year (320,000 b/d) CDU and 3.1 million mt/year No.1 continuous reformer. Shenghong's refinery will only have one crude distillation unit with a processing capacity of 16 million mt/year, which will become the single largest distillation unit in China. The project is slated for completion in 2021. China's independent Shenghong Group has opened a trading office in Singapore ahead of the start-up in the second half of 2021 of its refinery in Jiangsu province.

** PetroChina officially started construction works at its greenfield 20 million mt/year Guangdong petrochemical refinery in the southern Guangdong province on Dec. 5, 2018. Trial operations at the refining complex are expected to start in October 2021.

** China's coal chemical producer Xuyang Group has announced plans to build a greenfield 15 million mt/year refining and petrochemical complex in Tangshang in central Hebei province.