After a record investment of 800 bln usd in 2004, The Royal Dutch/Shell PLC's total investment in China has touched US$3 bln. Shell, with about 19 joint ventures in China is going ahead and investing another US$500 bln in China this year. Part of this will be towards participation in the investments of Chinese oil companies overseas. The company's investments are to focus on their retail ventures, the Nanhai project and the Hanhzhou city ring pipeline and it is probable that Shell may also position itself in the alternative energy market supplying electricity to remote parts of the country.
The Nanhai petrochemical plant in Guangdong, a 50:50 JV between Shell and CNOOC Petrochemicals Investment Ltd., is considered as Shell's biggest investment in China so far. This project is expected to begin operations at the end of 2005 and has received an investment of nearly US$4.3bln from Shell. With an estimated capacity of 2.3 mln tpa, production is to include ethylene, polyethylene and propylene with almost 93% of the production towards domestic comsumption.
On the retail front Shell is foreseen to open another 100 sites in Wuxi and Changzhou in the first quarter of 2006 after launching its retail operations early this year. Shell has also signed a joint venture contract with China Petroleum and Chemical Corp (Sinopec), China's largest oil refiner, last year to develop and operate about 500 service stations in Jiangsu Province and is hoping to tap into oversea projects with Chinese oil companies. China's heavy reliance on imports to meet demands of a booming economy will definitely be pruned with this development.
18-Jun-05 
