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Petrochemical Industry in 2010
I. Current Situation
Petrochemical industry is one of the mainstay industries in Guangzhou. In 2010, the output value of petrochemical manufacturing industries above the designated size amounted to RMB196.837 billion yuan, an increase of 18.5% over the previous year, taking up 13.37% of the total output value of industries above the designated size in the entire city.
i. Competitive Overall Industrial Scale
Focused on oil refining, ethylene, composite materials, coating, fine chemicals and rubber processing, the petrochemical industry in Guangzhou has formed an industrial chain characterized by a big variety, extensive range, large scale and international competitiveness. According to statistics in 2008 on petrochemical industry, the total asset of petrochemical industry covering petroleum and gas exploitation, petroleum processing, coking and nuclear fuel processing, chemical feedstocks and chemicals manufacturing, rubber products, etc, reached about RMB107.5 billion yuan, and the total revenue of core businesses was up to RMB182.4 billion yuan, the enterprises 2,357 and employees 150,000. China Petroleum & Chemical Corporation Guangzhou Branch (hereinafter referred to as SINOPEC Guangzhou) located in Huangpu District, has ranked the 7th in major oil refining petrochemical enterprises.
ii. Cluster of Transnational Companies
In 2010, 22 foreign investment projects were newly approved in Guangzhou petrochemical industry, with the contracted foreign capital of US$440 million, an increase of 84.19% over the previous year and the paid-in foreign investment of US$324 million, an increase of 75.32% over the previous year. Up to now, the foreign investment projects in Guangzhou petrochemical industry with an investment capital above US$50 million amount to 48, with a total investment volume of US$9.805 billion which mainly flows to lubricant manufacturing, petroleum product storage, rubber and tire production, fine chemical industry, daily chemical industry, etc. Renowned enterprises such as Colgate, Exxon Mobil, Dow Chemical, DuPont, Owens Corning from the USA, BP, Shell, Imperial Chemical Industries Limited from Britain, BASF and Bayer from Germany, TOTAL from France, Akzo Nobel from Holland, Lonza from Swiss, Nippon Oil Corporation, Tosoh, Marubeni, Idemitsu Kosan, Asahi Chemical Industry, Itochu from Japan, LG Chem from Korea, Formosa Plastic from Taiwan, and Blue Moon have gathered in Guangzhou.
iii. Favorable Industrial Environment
Guangzhou petrochemical industry has an edge in market position, infrastructure, industrial supports, service systems, etc. Guangdong with Guangzhou at the core is the largest consumer market of petrochemicals nationwide in terms of market volume and scale. Guangzhou has well-established infrastructure such as exclusive terminal facilities for petrochemicals, delivery line for petroleum products, swinging mooring facilities for crude oil, and convenient waterway and roadway transportations. Regarding industrial supports, Guangzhou is the prime industrial manufacturing base where heavy and chemical industries covering automobile, electronics, steel, shipbuilding, heavy machinery equipments, etc flourish. In respect of service systems, with the product pricing system preliminarily formed, Guangzhou has three exchange markets of national influence and radiation, i.e., Guangzhou Chemical Exchange Center, South China Petrochemical Exchange Center, Guangdong Plastic Exchange. Many professional petrochemical research institutes and universities/colleges including School of Chemistry and Chemical Engineering of Sun Yat-Sen University, School of Chemical and Energy Engineering of South China University of Technology, Lonza Fine Chemistry Research & Development Center, etc are located in Guangzhou, providing technology and talent resources.
II. Investment Priorities
i. Oil refining, ethylene and petrochemical processing. Oil refining and ethylene projects will be promoted and innovated, and major diesel oil hydrogenation units will be constructed to improve the quality of petrol and diesel oil; focus will be put on major projects inclusive of catalytic cracking energy saving and gas separation capacity expansion, catalytic dry gas for phenylethane making and optimization of hydrogen resources;
major high density polyethylene units and polypropylene units will be built to increase the productivity of ethylene and propylene; large scale aromatic hydrocarbon manufacturing units will be established to accelerate the development of synthetic fibre, synthetic resin and specific & fine chemical industries. Natural gas utilization projects and LNG refilling station will be set up in Guangzhou. High-end lubricant, road asphalt and other industries of petroleum deep processing will be spurred in line with the domestic demands.
ii. Chemical feedstocks and chemicals production. Enterprises both at home and abroad will be encouraged to develop basic organic chemical feedstocks such as benzene, methylbenzene, xylene, glycol and their derivatives, as well as the production of supporting raw materials of synthetic materials, synthetic fibre feedstocks, synthetic rubber, spices and essence, environment-friendly printing ink and organic polymer materials, etc. Driven by the strong demands for petrochemicals in automobile, electronics, shipbuilding industries, etc, priority will be attached to the production of automobile coatings, radiation curing coatings, marine coatings and container coatings, etc.
iii. Fine chemistry production. Based upon Guangzhou Development Zone and Nansha Development Zone, the fine chemistry industry in Guangzhou will be further strengthened and expanded. Foreign enterprises will be encouraged to invest in new products and technologies of catalyst, auxiliary agent and additives, commercialized processing technology of dye/paint, high-tech chemicals for electronics and paper making, food and feed additives, oilfield auxiliary agent, surfactants, water treatment reagents, cementing compound, inorfil, inorganic nano materials and deep processing of pigment coatings, etc.
iv. Daily chemicals production. By taking advantage of the cluster effect of well-known daily chemicals manufacturers including P&G, Colgate, Bawang, Blue Moon, etc as well as the huge market capacity and strong radiation force, initiatives will be taken to enhance the industrial brand and scale effect, and to introduce domestic and international high-end brands covering cosmetics, personal care, home care, etc.
v. Petrochemical special equipments production. Focus will be put on manufacturing of oil exploring, drilling, gathering and transmission equipments, of techniques and key equipments for aminophenol, enzyme preparation and food additives, of comprehensive utility units of scrap tires and of key equipments of large ethylene complete unit.
III. Investment Projects
i. Huangpu Petrochemical and Fine Chemistry Industrial Base
Project profile: Huangpu Petrochemical and Fine Chemistry Industrial Base is located north of Guangzhou petrochemical industrial district with an area of about 700 hectares, among which, Guangzhou petrochemical industrial district and oil refining district take up about 365 hectares; the land in the north of the petrochemical industrial district and between the industrial district and the oil refining district cover an area of 250 hectares. Based on the upgrading and innovation as well as the industrial chain expansion of Guangzhou petrochemical industrial district and guided by the ideal of “ecological environment, high technology, fine industry and efficiency cluster”, the industrial park will be planned from a high starting point in line with high standards. Focus will be put on fine chemical industries including fine chemicals, daily chemicals and chemical-related industries which have wide user coverage, high added value and great potential. Projects to be admitted into the park must be safe, environment-friendly and with economic efficiency.
ii. Nansha Fine Chemistry Industrial Base
Project profile: the land used for fine chemistry industrial base concentrated on Xiaohu Island and the central and southern part of Shazai Island, with an area of 3 square kilometers.
iii. Petrochemical Industrial Base in the East
Project profile: reforming project on oil refining system of SINOPEC Guangzhou; innovation and expansion project of Guangzhou petrochemical ethylene unit.