Published on the official account of China National Petroleum Corporation in Beijing at 22:18 on 2024-11-07

Published on the official account of China National Petroleum Corporation in Beijing at 22:18 on 2024-11-07

On Oct 28, an authoritative foreign media reported that PetroChina plans to close its largest refinery in Dalian, Liaoning Province in mid-2025, & will replace the refinery with a smaller facility at a new site.

According to reports, Dalian Petrochemical has been completely shut down. The plant's daily output is 410,000 barrels, accounting for 3% of China's total refining output & about half of the plant's total crude oil processing capacity.

However, the truth is not so.

On Oct 28, the official website of Dalian Municipal Government announced that Dalian Petrochemical's relocation has been accelerated, & the construction of supporting roads for the Xizhongdao Refining and Chemical Industrial Park, which is about to be relocated, has started. At present, the Dalian Petrochemical relocation project will be built in 2 phases at the Xizhongdao Petrochemical Industrial Base. The 1st phase will build a new 10 million tpy refining & 1.2 million tpy ethylene project.

Subsequently, the 2nd phase of the relocation project was launched. After it is completed & put into production, Xizhong Island will eventually achieve a refining capacity of 20 million tons & 2.4 million tons of ethylene.

As the relocation site for Dalian Petrochemical, Dalian Changxing Island (Xizhong Island) Petrochemical Industrial Base is vigorously carrying out the construction of a series of major basic supporting facilities. The 1st phase of the workboat terminal in the Xizhong Island operation area of Dalian Port's Changxing Island Port Area has been completed & is about to be put into use. The construction of two 10,000-ton liquid terminals is being accelerated, the construction of public pipeline corridors is in full swing, & the supporting roads of the Xizhong Island Refining & Chemical Industrial Park are about to start. The infrastructure construction of the park has entered the "fast lane" in an all-round way, paving the way for the construction of Dalian Petrochemical's new refining and chemical projects.

In March 2024, the agreement for the relocation, upgrading & transformation project of PetroChina Dalian Petrochemical with a total investment of 68.5 billion yuan was officially signed.
 

The relocation project of PetroChina Dalian Petrochemical has a long history.

▶In 2013, the National Development and Reform Commission proposed the "Petrochemical Industry Planning and Layout Plan (Draft for Comments)" to arrange a total of seven petrochemical industrial bases across the country. Among them, Dalian Xizhongdao (Changxing Island) Petrochemical Park, as an important part and professional park of the national economic and technological development zone - Changxing Island Economic and Technological Development Zone, has become the first choice for Dalian Petrochemical to relocate.

▶In 2014, the Environmental Impact Report of the 15 million tons/year Russian oil processing project of the Changxing Island Refining and Chemical Project (Phase I) of China Petroleum Dalian Petrochemical Company was published online. The environmental impact assessment report shows that China National Petroleum Corporation and the Dalian Municipal People's Government have signed the "Dalian Changxing Island Refining Project Cooperation Framework Agreement", planning to relocate the 2050×10 4 t/a crude oil processing capacity of China Petroleum Dalian Petrochemical Company to Changxing Island. This project processes 15 million tons of imported Russian crude oil per year. According to the China Petroleum plan, the Changxing Island Refining and Chemical Project belongs to the relocation and transformation project of Dalian Petrochemical Company. The project will be built in phases, with the first phase being new construction and the second phase being relocation.

▶On November 20, 2022, the Dalian Municipal Government and China National Petroleum Corporation held a signing ceremony for the cooperation framework agreement on the relocation and transformation project of Dalian Petrochemical. It is reported that the Dalian Petrochemical relocation project will be built in two phases at the Xizhongdao Petrochemical Industrial Base. The first phase will build a new 10 million tons/year refining and 1.2 million tons/year ethylene project, and strive to be completed and put into production in 2024. Subsequently, the second phase of the relocation project will be launched. After all are completed and put into production, the final production capacity of 20 million tons of refining and 2.4 million tons of ethylene will be achieved in Xizhongdao. This production capacity is basically equivalent to the current atmospheric and vacuum production capacity of Dalian Petrochemical; data shows that Dalian Petrochemical's ethylene production in 2023 will be 1.5 million tons, and the ethylene production capacity will increase by 900,000 tons after the relocation.

▶In March 2024, Dalian City and China National Petroleum Corporation held a working consultation meeting in Beijing. The two sides reached an agreement on the relocation time limit and the construction of the Dalian Changxing Island (Xizhong Island) new plant project. The Dalian Petrochemical relocation and upgrading project has made substantial progress. At present, the preliminary work of the new refining and chemical project is being accelerated. According to the development strategy of "differentiation, high-end, and characteristic", a new "chain extension" project of 10 million tons/year of refining and 1.4 million tons/year of ethylene and downstream chemical new materials will be built to actively create a green, low-carbon and efficient new refining and chemical integration project.

Public data shows that Dalian Petrochemical is affiliated to China National Petroleum Corporation . It is located at No. 1 Shanzhong Street, Ganjingzi District, Dalian City, Liaoning Province. It currently has 48 sets of refining production units and 7 sets of chemical production units. The annual crude oil processing capacity is 20.5 million tons. It can produce more than 200 petrochemical products such as gasoline, kerosene, diesel, lubricants, paraffin, benzene, polypropylene, fine denier fiber, etc. It has 5 oil loading and unloading terminals, 15 berths of 5,000-100,000 tons, and 1 workboat terminal, with an annual throughput capacity of more than 23 million tons. In terms of volume, it is definitely among the top ten refineries in China. Located in the urban area, such a large production volume will inevitably have problems in various aspects such as environmental protection and safety. This is also a realistic problem that plagues the long-term and stable development of Dalian Petrochemical. In order to return a cleaner urban area to the city and provide a better development platform for enterprises, relocation to a park with more development potential has become the long-cherished wish of China National Petroleum Corporation and the local governments of Liaoning and Dalian for many years.