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Petrochemical industry oils Huizhou economy

By Song Hongmei (Chinadaily.com.cn)
Updated: 2006-12-23 10:24

Situated in the southeast of China's most developed province, Guangdong, Huizhou boasts two national-level development zones, the Dayawan Economic and Technological Development Zone and the Zhongkai High and New Technological Development Zone, according to Li Ruqiu, acting mayor of Huizhou.

Li Ruqiu, acting mayor of Huizhou, speaks during a press conference held on Friday, December 22, 2005. [chinadaily.com.cn]

With the completion of China National Oil Corporation (CNOOC) and Shell Petrochemicals Company (CSPC), a 50-50 joint venture between CNOOC and Royal Dutch Shell, and the launch of CNOOC Nanhai Oil Refinery, the Dayawan development zone has met an unprecedented opportunity to grow to be a world-class petrochemical industrial base. The area has entered a new era of economic and social development, said Li at a press conference on Friday.

CNOOC is China's third-biggest oil company. Its petrochemicals complex with Shell, which is so far the largest joint venture project in China, became operational in March, involving a total investment of US$4.3 billion. It will supply 2.3 million tons of petrochemical products every year to Guangdong and neighboring provinces in southern China, said the joint venture's deputy chief executive officer Zhai Hongxing on Friday.

CSPC deputy chief executive officer Zhai Hongxing answers journalists' questions in the Dayawan Economic and Technological Development Zone in Huizhou, South China's Guangdong Province, December 22, 2006. [chinadaily.com.cn]

CSPC finally chose Huizhou as its location because the city has a natural port which ensures convenient transportation by ship, as Huizhou is close to the Pearl River Delta Region. Some 57 percent of its target market is in the Delta Region, which means reduced costs. The Huizhou government has also invested about one billion yuan in improving infrastructure and the investment environment , Zai told chinadaily.com.cn.

Nearby, the CNOOC Nanhai Oil Refinery Project is under construction. The project involves a total investment of 19.3 billion yuan (US$2.4 billion) and its annual sales are expected to reach 34 billion yuan after it comes on stream in 2008.