Sinopec and Kuwait Petroleum Corporation break ground on a $9bn plant as Kuwait crude exports surge to 50%, although investments in Libya may have fallen short.
Trade between Kuwait and China has flourished in the last couple of months as they start work on a new joint venture refinery and enjoy booming crude sales. Chinese governmental reports show a 50.2% surge in crude oil imports from Kuwait in October to 1.28 million tons, or around 302,000 barrels-per-day.
Although overall Kuwaiti exports for the first ten months were actually down 4.6% to 7.96 million tons (192,000 bpd) from last year, their share of China's total crude imports showed a modest rise from 5.1% to 6.1% compared with the same month last year.
Building work on a joint venture between state-run Kuwait Petroleum Corporation and China's top refiner Sinopec to build a 300,000bpd refinery on Donghai Island of Zhanjiang in south Guangdong province has started this month, after years of negotiations with China's top economic planner the National Development and Reform Commission.
On completion in 2014, the plant will have a one million ton/year ethylene capacity and, unlike some of the nations older refineries, will be capable of producing Euro V emission standard gasoline as well as Euro IV emission standard diesel.
Bilateral trade between the two countries reached $8.54 billion in 2010, increasing a hefty 68% from a year earlier. Nonetheless, Saudi Arabia remains the nations top supplier to China shipping over one million bpd, followed by Iran, whose sales to the world's second largest oil consumer rose 46% to 597,000 bpd in 2010.
Not all of China's partnerships in the Middle East and Africa have been as successful, as China has “suffered severe economic losses” as a result of the conflict in Libya. China's three major state-owned oil firms China National Petroleum Corp., Sinopec and CNOOC all have engineering projects in the conflict-torn nation, although none have actually began oil production.
Foreign Ministry spokesman Liu Weimin remains optimistic and has reasserted China's commitment to “encouraging Chinese enterprises to actively engage in the post-war reconstruction of Libya.” The transitional Libyan government has since agreed to begin compensating Chinese companies for their losses.