BP Chemicals to ago ahead with China chemical project
BP Chemicals to ago ahead with China chemical project
SINGAPORE (Reuter): BP Chemicals, a unit of giant British
Petroleum, is pressing ahead with multi-billion dollar
investments in China, dispelling energy industry fears of changes
to investment policies after Deng Xiaoping's death.
"I don't see any change after Deng. It is not as if this was a
shock," BP Chemicals, chief executive officer Bryan Sanderson
told reporters yesterday at the sidelines of the second Asia
Pacific Chemical Conference.
Sanderson said BP was hoping to start up the first portion of
its U.S$2.5 billion 50/50 joint-venture with Shanghai
Petrochemicals Co Ltd in 1999.
"The intention is that the acrylonitrile plant will be the
first to be commissioned in 1999. Other plants will be introduced
on a phased basis during the period to 2003."
Energy analysts have said they did not see any changes to
China's energy investment policies following the death of the
reform-minded Deng.
However, they added they were concerned that decisions on
projects could be delayed while the power vacuum is filled.
At the heart of the project in Jinshan is a 650,000-ton-per-
year ethylene plant that will feed a number of downstream units,
including a major polyethylene plant.
State-owned China Petrochemical Corp, or SINOPEC, is the
majority shareholder of Shanghai Petrochemicals.
Sanderson said BP had "undergone a major step change within
the last few months" in its China commitment and involvement.
"The proposed joint venture will be one of only a limited
number of such complexes which will be approved by the Chinese
authorities in the development of the petrochemical industry," he
said.
Chinese state planners are looking to promote six ethylene
projects with annual capacity of 600,000 tons or more, the
official China Daily said recently.
The other company to have received the nod to build is BASF AG
in Janjing in Jiangsu province.
China's State Planning Commission is due to decide in the
first half of this year on another project mooted by Royal
Dutch/Shell Group, said a China National Offshore Oil Corp
spokesman, a partner in the project.
Dow Chemical Co hopes for approval in the first half of this
year to build in Tianjin. Exxon Corp and Amoco Corp are bidding
to build a plant in Fujian province.
BP is currently building a 150,000-ton-per-year acetic acid
plant in Chongqing, southwest China, and is looking to translate
the experience gained there to the Shanghai project.
The U.S. $200 million plant in which BP has a 51 percent stake
while Yangtze River Acetyls and Sichuan Vinylon will share a 44
percent stake, is expected to start up in mid-1998.
A third company, Chongqing Investment and Construction, will
take up the remaining five percent share.
The UK-giant is also beefing up investments in Southeast Asia.
Yesterday it announced plans to build a U.S.$200 million,
500,000-ton-per-year acetic acid plant in Kuantan, on the east
coast of Peninsular Malaysia.
The plant a 70/30 joint venture between BP and state-owned
Petroliam National Bhd (Petronas) is due to start up in 1999.
In Indonesia, BP has joined a consortium of four Japanese
firms and one Indonesian firm to work on a feasibility study for
the building of a 700,000-tons-per-year ethylene plant, which is
expected to go on stream in 2000.