March 05, 2025 [Oil Price]- State-controlled China National Offshore Oil Company (CNOOC) is set to launch a refinery and petrochemicals complex later this year, following a $2.74-billion upgrade, Reuters reported on Tuesday, quoting industry sources.

The upgraded joint venture complex on the Daxie Island in Ningbo will feature a 120,000 barrels-per-day (bpd) crude unit, which could raise CNOOC’s demand to import crude later this year. With the new unit, the crude processing capacity at the facility will jump by 50% to 240,000 bpd.

CNOOC’s overall crude processing capacity is expected to increase to about 1 million bpd with the launch of the upgraded refinery and petrochemicals complex on Daxie Island, the sources told Reuters.

The complex is set to launch operations at some point in the middle of this year, according to Reuters’s sources.

It will also have a catalytic cracker, a hydrocracker, a continuous reformer, and two polypropylene units, each with a capacity of 450,000 tons per year, according to a recent procurement tender document from CNOOC that Reuters has seen.

CNOOC’s core business is oil and gas exploration and production, but the state firm looks to expand its downstream operations, too.

Last month, Shell Petrochemicals Company Limited (CSPC), a joint venture between Shell and CNOOC Petrochemicals Investment Ltd, took the final investment decision to expand its petrochemical complex in Daya Bay, Huizhou, in southern China.

The expansion will include a third ethylene cracker with a planned capacity of 1.6 million tons per year of ethylene, a key building block to make plastics, and associated downstream derivatives units producing chemicals including linear alpha olefins.

CSPC’s investment, which Shell did not quantify in its press release, also includes a new facility that will produce 320,000 tons per year of high-performance specialty chemicals, such as polycarbonates and carbonate solvents, critical for everyday life.

The expanded complex will primarily aim to meet domestic demand in China, with the expansion expected to be completed in 2028.