Asia to gain $20b for new refineries
Asia to gain $20b for new refineries
SINGAPORE (AFP): Asia will gain substantial new oil refining capacity with about US$20 billion in "firm" investment expected up to 1998, adding substantial new capacity in the region, an official said yesterday.
"Total firm additions are estimated at 2.7 million barrels per day and the greatest increases will occur in South Korea, China, India, Japan and Thailand," said Andrew Speirs, U.S.-based Chem Systems's general manager for East Asia.
Speirs told an international conference on Asia's fuels and lubricants here that about 80 percent of the increase will be in major expansion of existing refineries, with only five new refineries to be established.
He said the low level of firm Chinese refining expansions, relative to projected demand growth, "reflects the uncertainties that exist in China with regard to the regulatory and legal structures that will define new investments."
"Despite many projects that are being studied, international companies are taking a slow approach before committing to major investments in China," Speirs told more than 250 officials from the downstream sector of Asia's oil industry attending the conference.
He said that while refiners in developed nations were concentrating on reducing costs by improving quality and output from existing facilities, Asian refiners were focusing on increasing total volume of product output in response to the region's rapid growth for petroleum products.
Refinery capacity in East Asia now exceeded that of both Europe and America, Speirs said, adding that China, Japan, South Korea, India and Indonesia would account for more than 70 percent of the next decade's increase in product demand.
Singapore, Asia's traditional refining center, was not increasing its refining capacity in line with the region but was likely to be the "swing" supplier, increasingly focusing on higher value petroleum products and petrochemicals, he said.
Conference participants from more than 15 countries discussed the latest fuels and lubricants trends in the Asian region.