PetroChina, the country's second biggest oil refiner, plans to export about 26% more of oil products in November than October, as the company has been ramping up exports following the startup of the new Yunnan refinery.
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This is line with the company's strategy, which is to export more oil products to the overseas market, and increase procurement of oil products from independent refineries, according to a PetroChina source.
PetroChina has planned to export a total of around 1.51 million mt of oil products in November, which would be around 25.8% higher from an estimated export of 1.2 million mt in October, the company source said.
About 80% of those exports will come from three of its major refineries -- Dalian Petrochemical and Dalian Wepec in northeastern Liaoning province, as well as Guangxi Petrochemical in southwestern Guangxi province.
These three refineries have raised their exports in November by 17% to around 1.17 million mt, up from a planned export of around 1 million mt last month.
About half of the exports will be gasoline, which is around 700,000 mt, as PetroChina is a major exporter of gasoline.
In addition, a total of 620,000 mt of gasoil and 190,000 mt of jet fuel exports have also been planned for the month.
YUNNAN OPERATES AT 90% OF CAPACITY
PetroChina's new 260,000 b/d Yunnan refinery, in southwestern Yunnan province, has been running at around 90% of its nameplate capacity in recent months, according to sources.
New refineries normally operate at a relatively high rate in order to test if all the units run well, a Guangxi Petrochemical source said.
Responding to the higher run rate at the Yunnan refinery, its neighboring refinery Guangxi Petrochemical has ramped up its exports in November by about 21.5% month on month to around 395,000 mt.
PetroChina would need to raise its refining capacity utilization rate to 79.8% in the last quarter of this year, from 78.9% recorded in the third quarter, in order to meet its 2017 throughput target, S&P Global Platts calculations based on the company's latest report showed.
NEW QUOTAS ON THE WAY
Meanwhile, the long-awaited new round of quotas for oil products are expected to be released this week, with some expecting the volume to be around 5 million mt in total.
A source at a state-owned trading company heard that about 60% of the quota covers gasoil. In that case, it is likely that the quotas will not be used up, the source said.
Demand for gasoil has been strong in recent months, so refiners may not be willing to export more currently, the source added.
Meanwhile, some market sources also expect around 30% of the new quotas to go to gasoline.