Chinese Refiner Rongsheng Buys its First Canadian TMX Crude Oil Cargo
06.04.2024 By Tank Terminals - NEWS

June 04, 2024 [Reuters]- Chinese refiner Rongsheng Petrochemical has bought its first Canadian crude cargo via the recently expanded Trans Mountain pipeline (TMX) from TotalEnergies through a tender, several trade sources said on Monday.

 

The 500,000-barrel cargo of Access Western Blend (AWB) crude will be delivered to Rongsheng’s refinery in Zhoushan in August, they added.

AWB is a type of heavy and highly acidic diluted bitumen produced by Canadian Natural Resources and MEG Energy.

The price was not immediately available.

TMX, which will ship an additional 590,000 barrels per day (bpd) to Canada’s Pacific coast from Alberta, began commercial operations last month after years of regulatory delays and construction setbacks.

Flows on the pipeline and loadings from the Westridge Marine Terminal are being closely monitored by traders and shippers as the expansion gives Canadian producers more access to U.S. West Coast and Asian markets.

The first TMX cargo purchased by Chinese refiner Sinochem Corp is en-route to China while Sinopec, PetroChina and India’s Reliance Industries have bought cargoes.

Sellers of Canadian oil are exploring ways to increase exports to Asia where demand is growing and as Asian refiners typically pay higher premiums.

However, some Asian refiners are unable to process certain Canadian grades due to their high sulphur and acid content, traders said.

Besides AWB, Totsa has also offered Cold Lake crude from the pipeline to Asian buyers, they added.

Separately in the tender, Rongsheng also bought 2 million barrels of Abu Dhabi Upper Zakum crude from Aramco Trading at 60 cents a barrel above July Dubai quotes before freight charges in the tender, the sources said.

The Chinese refiner also purchased 2 million barrels of West African crude consisting of Congolese Djeno and Angolan Mostarda grades at $2.50-$3 a barrel above July dated Brent on cost and freight basis from Unipec, they added.

The companies do not comment on commercial deals.

 

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