March 15, 2021 [Argus Media] – Chinese state-controlled firm Sinopec has started testing new crude storage tanks at its Luoyang commercial storage site in central Henan province, readying them for operation by the second quarter of this year.
Sinopec has built another eight tanks, each with a capacity of 629,000 bl and totalling 5mn bl, in addition to the 5mn bl of storage it added to the site last year that will primarily serve its 160,000 b/d Luoyang refinery in central Henan.
The company started hydro-pressure testing one of the eight tanks late last month, which would take 2-3 months to complete, a company source said, adding that actual filling would depend on crude prices. The company also drew stocks from existing tanks to supply the Luoyang plant at the end of last month for the first time.
Crude unloaded at Shandong province’s Rizhao port is transported via pipeline to the Luoyang tanks to supply the Luoyang refinery. The new infrastructure will allow Luoyang to increase its intake of seaborne crude, including Mideast Gulf crude. Sinopec started injecting crude into the first-phase storage site last August.
But although the Luoyang refinery has expanded from 160,000 b/d to 200,000 b/d, it is still running closer to its old capacity, partly because of demand concerns, the Sinopec source said.
The local government is also pushing Sinopec to start constructing a 1mn t/yr ethylene plant at the refinery by 2023. Sinopec already plans to add a combined 2.2mn t/yr of ethylene capacity at its Tahe and Tianjin refineries during 2021-2025.
Sinopec has completed three storage sites, totalling 25mn bl, at Donghai in Guangdong, Nangang in Tianjin and Kuche in Xinjiang since last December, with at least another 25mn bl planned at Hunan, Guangdong and Fujian for this year, in addition to the Luoyang site.
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