CHONGQING: BP, Europe's biggest oil company, and China's leading oil refiner Sinopec, Wednesday announced the successful expansion of the joint acetic acid plant in Southwest China's Chongqing Municipality by 75 per cent through a further investment of 1.2 billion yuan (US$148 million).
Prior to completion of the expansion an initial investment of 1.6 billion yuan (US$197 million) was made by BP and Sinopec in order to purchase production facilities for 200,000 tons of acetic acid and 80,000 tons of esters annually.
The completed petrochemical plant, the Yangtze River Acetyls Co Ltd (YARACO), is now able to produce 350,000 tons of acetic acid annually.
The investors are also building storage and transportation infrastructure to ensure the delivery of products to the target market in the east coastal areas, company officials said Wednesday in Chongqing.
BP holds a 51 per cent stake in the venture, and Sinopec owns 44 per cent through its local subsidiary in Sichuan Province, with the remaining 5 per cent belonging to a local investment company in Chongqing.
"YARACO's success has given us the confidence to expand our business position in China. I'm fully convinced that, with the combination of BP's advanced technology, BP's and Sinopec's management skills and Sinopec's knowledge of the local market, YARACO will be a very competitive business in the marketplace," said Steve Welch, BP group vice-president for aromatics and acetyls.
The joint venture uses BP's advanced technology to produce acetic acid products, which could almost double its output capacity, said Liu Huaan, a technical engineer at YARACO.
The plant uses natural gas to produce acetic acid, which is used as an intermediate in a wide range of downstream products such as fibres, paints and adhesives.
YARACO consumes around 100 million cubic metres of natural gas annually, Liu told China Daily.
China's energy needs are surging causing petrochemical companies like the UK-based energy conglomerate to step up efforts to tap this soaring demand.
At the beginning of last month, the two strategic partners Sinopec and BP announced another 50-50 joint venture in Nanjing, capital of East China's Jiangsu Province, also to produce acetic acid products.
BP plans to spend up to US$8 billion over the next 10 years developing alternative energy projects such as wind and solar power, capitalizing on the growing interest in low carbon power, the company announced earlier this week.
Source: China Daily