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Sinopec boosts refineries Apr crude run by 8% from March

April 16/2020

MOSCOW (MRC) -- China's Sinopec increased its April utilization rate by about eight percentage points from March as more and more of its refineries raised crude runs to levels that were reported prior to the spread of COVID-19, a survey by S&P Global showed.

As a result, China's throughput is likely to hit 12.5 million b/d in April, or 90% of the level achieved in January, after falling by about 3.3 million b/d in February, Platts data showed.

The survey saw 16 refineries - accounting for 68% of Sinopec's total refining capacity - lift their combination run rate to 80% in April, from the 72% polled in March and 64% in February, closing in on January's rate of about 89% when the country had yet to be put under complete lockdown following the outbreak of the coronavirus.

Seven of the polled Sinopec refineries raised their April operating rates to the level recorded in January and December. In contrast, only two had done so in March.

Except for the Zangzhou refinery in central China, the rest of these seven refineries are along the developed coastal regions in the south and east of China, where demand rose at a faster pace than in the north and the landlocked west, where PetroChina's refineries are located.

Almost all the surveyed refineries saw an increase in April planned throughput, than in March, as gasoil and gasoline demand rose with the resumption of economic activity and as the number of fresh COVID-19 cases plateaued in China.

Even the 260,000 b/d Gaoqiao Petrochemical in Shanghai, which had shut its No.3 FCC in April for maintenance, lifted its planned crude run slightly to 73% in April from 72% in March.

Meanwhile, the 170,000 b/d Sinopec-SK Wuhan Petrochemical hiked its utilization rate by two percentage points on the month to 61% in April as Wuhan city is no longer under lockdown since early this month.

Only the flagship 460,000 b/d Zhenhai Petrochemical in eastern China Ningbo reduced its April crude run to 65.6%, from 75% in March, as it has shut a 160,000 b/d CDU for maintenance.

However, throughput recovery is likely to be capped as the outlets for export of oil products are limited in light of lockdowns across the world, which has sapped global demand, a Shandong-based Sinopec refiner said.

Its peer, PetroChina, has cut a combination run rate in six refineries to 60% in April from 63.3% in March and 65% in February, with the heaviest reductions from the exporting PetroChina plants, Platts report previously.

Independent refineries in Shandong province raised their average run rate to over 60% this week and are expected to up this to 70% by the end of this month, Platts reported.

Platts will publish the final April throughput survey for about 19 of Sinopec's refineries, 17 of PetroChina's and one CNOOC refinery later this month.

We remind that, as MRC wrote before, Sinopec Qilu Petrochemical, a subsidiary of Sinopec Corporation, plans to shut the cracker  unit in Tianjin in northeast China for scheduled repairs on 15 June, 2020. This cracking unit with a capacity of 900,000 tonnes of ethylene per year and 480,000 tonnes of propylene tons per year will be closed for scheduled repairs until 24 June, 2020.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, estimated PE consumption totalled 383,760 tonnes in the first two month of 2020, up by 14% year on year. High density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased due to the increased capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market were 192,760 tonnes in January-February 2020, down by 6% year on year. Homopolymer PP accounted for the main decrease in imports.

Sinopec corp. is one of the world's largest integrated energy and chemical companies. Business Sinopec Corp. includes oil and gas exploration, production and transportation of oil and gas, oil refining, petrochemical production, production of mineral fertilizers and other chemical products. In terms of refining capacity, Sinopec Corp. ranks second in the world, in terms of ethylene capacity - fourth.


mrcplast.com
Author:Margaret Volkova
Tags:PP, PE, LLDPE, crude and gaz condensate, homopolymer PP, propylene, HDPE, ethylene, petrochemistry, PetroChina, Sinopec, China, Russia.
Category:General News
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