Chevron, Sinopec may join in shale gas deal

China, September 17th, 2010 - Major US oil company Chevron Corp and China Petrochemical Corp (Sinopec) may join forces to explore and develop shale gas in southwestern China at the end of the year, the Wall Street Journal reported Friday, citing an unnamed source.

Chevron has identified a gas block near Guiyang, in Guizhou province, close to an area that BP and Sinopec Group are exploring, the paper said.

lJohn Watson, Chevron's chairman and chief executive, also told the Journal that the company is talking with Sinopec about cooperating on shale gas in China, but he did not give a timetable.

Gareth Johnstone, the Singapore-based spokesman for Chevron, confirmed the news to Bloomberg by e-mail today, but did not elaborate beyond that.

Sinopec Group said it aims to have the capacity to produce 2.5 billion cubic meters of unconventional gas annually by the end of 2015, including shale gas and coalbed methane, according to the paper.

Sinopec will prioritize shale gas exploration and development over other unconventional gas resources, the paper said, quoting Sinopec's general manager Su Shulin. - ChinaDaily

China's Sinopec cancels Sep turnaround plans for solvents plants

Singapore, September 7th, 2010 - China's Sinopec has indefinitely canceled turnaround plans for itssolvents plants at Yanshan and Tianjin in September due to strong local demandand prices, industry sources said Tuesday.

Sinopec Beijing Yanshan had planned to shut the smaller of its twosolvents production lines at Yanshan on September 10 for planned maintenance.The two phenol-acetone production lines have a capacity of 160,000 mt/year and100,000 mt/year, respectively.

Instead, both lines are now running at about 100% of capacity. On August27, Sinopec Yanshan increased its ex-works phenol offer prices to Yuan15,200/mt ($2,233/mt), up Yuan 600/mt from Yuan 14,600/mt on August 24.

Similarly, Sinopec Sabic Tianjin Petrochemical dropped its turnaroundplans for its Tianjin-based plant, which can make 220,000 mt/year of phenoland 140,000 mt/year of acetone.

Sinopec Sabic Tianjin Petrochemical is a 50:50 joint venture betweenSaudi Basic Industries Corporation, or Sabic, and China Petroleum & ChemicalCorporation, or Sinopec.

The joint venture plant reduced its production to about 40-50% ofcapacity last week, down from about 60-70% in August.

Local demand is being driven by downstream bisphenol-A producers. Phenoland acetone jointly go into the production of BPA, a raw material used formaking polycarbonate.

The strong demand led to Sinopec Shanghai Mitsui Chemicals raising itsBPA offer prices to Yuan 18,000/mt on August 30, up Yuan 500/mt from Yuan17,500/mt.

A China-based source said other factors that influenced Sinopec'sdecision to cancel the turnarounds are maintenance plans by other localsolvents producers.

For instance, Bluestar Harbin Petrochemical is expected to shut itsphenol-acetone plant at Harbin, Heilongjiang province about mid-September fora 20-25 day turnaround.

The wholly owned subsidiary of China National Bluestar operates a plantthat can deliver 72,000 mt/year of phenol and 48,000 mt/year of acetone.

Also, Jilin Petrochemical, a subsidiary of PetroChina, is expected toshut its 120,000 mt/year solvents plant in Jilin province at the end ofSeptember for scheduled maintenance, lasting about a month. - Platts

Sinopec Jinling 2010 Oil Processing May Be 4% Below Target

Beijing, September 1st, 2010 - China Petroleum & Chemical Corp.’s Jinling refinery may process 4 percent less oil than an original target for this year as demand isn’t “as good as” expected, said the head of the plant.

The refinery may process 13 million tons of crude this year, or 260,000 barrels a day, compared with the plan of 13.5 million tons assigned by China Petroleum & Chemical, Zhang Dafu, chairman of the plant, said in a telephone interview from Nanjing city in eastern China.

Sinopec, as China Petroleum & Chemical is known, previously planned to expand Jinling’s refining capacity by 33 percent to 18 million tons a year by 2010. It is now studying a plan to upgrade oil processing units to improve fuel quality, Zhang said. Details such as investment and timeframe haven’t been decided, he said.

“We are changing our direction to upgrade units for fuel quality improvement instead of expanding refining capacity by a big amount,” Zhang said, without providing details.

Sinopec Jinling has an annual capacity of 13.5 million tons, and its monthly processing volume is currently about 1.1 million tons, or almost at its designed capacity, Zhang said. The plant processed 12.2 million tons of oil in 2009, he said.

The plant completed maintenance on major refining units in the first half and will have occasional shutdowns of smaller units during the rest of the year, he said. - Bloomberg

Sinopec Studying Acquisition Possibilities, Chairman Su Says

Beijing, August 23rd, 2010 - China Petroleum & Chemical Corp., also known as Sinopec, is studying acquisition possibilities, including buying assets from its parent and purchasing directly from the market, Chairman Su Shulin said at a media briefing in Hong Kong today, without elaborating on potential targets.

Sinopec takes a cautious stance when evaluating takeover opportunities, according to the company’s chairman. “There are a lot of acquisition opportunities, but there may not be many good ones,” Su said. - Bloomberg