China plans to revive a $ 20 billion petrochemical project in the eastern Shandong Province, with a value of $ 20 billion.
According to Reuters, two sources familiar with the approval of the project said that the National Development and Reform Commission, the government agency concerned with planning, gave preliminary approval of the project on Monday, which allowed the region Shandong to start building planning.
Despite the project’s proposal years ago, approval of it has slowed due to China’s excessive refining capacity. The project includes the construction of a 400,000 bpd refinery and an ethylene plant with a capacity of three million tons annually in Yantai City, Shandong Province, the center of independent oil refining companies in this country.
According to one of the sources, the investment in this project will amount to approximately 140 billion yuan (20 billion dollars). China’s corporate registration data, seen by Reuters, showed that Shandong Nanshan Group, a Yantai-based aluminum smelter, would be the main investor in the project, which also includes other investors including the Wanhua Chemical Group and the Shandong Provincial Government.
A comment from Shandong Yulong Petrochemical Company, one of the project's representatives, has yet to be reached, and the National Development and Reform Commission has yet to respond to Reuters' request for comment.
The two sources refused to reveal their names because they were not authorized to speak to the media.
The project may help reduce China's petrochemical imports, but it is likely to exacerbate its surplus of refined fuel products.
Analysts expect this mega project to be operational by the end of 2024.
