Sinopec Group, the Fujian provincial government and a Taiwan consortium have signed a framework agreement to build a US$4.5 bln petrochemical complex in Fujian, as per Reuters. The complex, to be located in Gulei of Zhangzhou city, has been initially designed to have crude refining capacity of 16 mln tps (320,000 bpd) and ethylene production capacity of 1.2 mln tpa. The project needs government approval. If approved, the project would be the largest investment by Taiwan in the oil sector in mainland China. It would also be the third major refinery in Fujian province after a 240,000 bpd joint venture by Sinopec, Saudi Aramco and ExxonMobil and a 240,000 bpd refinery planned by China's Sinochem Corp.
The Taiwan consortium comprises four companies -- China Petrochemical Development Corp , Ho Tung Chemical Corp , LCY Chemical Corp and USI Corp , who would conduct feasibility studies on the Fujian project, but the investment requires government permission and approval from the companies' board of directors. Taiwan currently bans petrochemical firms from setting up strategic facilities such as naphtha crackers and refineries in political rival China, though downstream production such as for plastics is allowed.