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Petrochemicals to dominate upcoming project starts across China’s oil and gas value chain

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China is expected to see 512 petrochemical projects commence operations over 2021–2025, accounting for 76% of the total project starts across the country’s oil and gas value chain. In petrochemicals, newbuild projects dominate the project starts, accounting for more than 90%, while the rest are expansion projects, according to GlobalData.

The company’s latest analysis reveals that China is expected to have 676 projects commence operations during the forecast period. Out of these, 45 will be upstream projects, 81 midstream projects, 38 refineries and 512 petrochemicals projects.

Soorya Tejomoortula, Oil & Gas Analyst at GlobalData, comments: ‘Massive investments are presently underway in the Chinese petrochemicals sector by both domestic and foreign investors to meet the ever-growing demand. Some of the major sectors driving petrochemicals demand in China include packaging, consumer durables and automobiles.’

Among the upcoming petrochemical projects in China by 2025, Zhejiang Petrochemical Daishan Xylene Plant 2 is a key project with a capacity of 4.8mn t/y and costing $4.5bn. The newbuild plant is currently under construction and is expected to start operations by 2022.

In the upstream (fields) segment, GlobalData expects 45 projects to come onstream in China during 2021–2025. Some of the notable projects include Kenli 6-1, a shallow water conventional oil field currently under construction and expected onstream later this year. Meanwhile, the Weirong shale gas field is being expanded under Weirong Phase II, as part of China’s efforts to push for unconventional resources development and increase domestic gas production.

Midstream projects will account for around 12% of all oil and gas projects, according to GlobalData. LNG regasification projects will dominate, with the 487bn cf capacity Yantai Expansion terminal being a key development. The $1.1bn project has received approval and is expected to start operations in 2025.

Meanwhile, looking at pipelines, the 3,371 km Power Of Siberia 1 (China section) gas pipeline is a key project. Costing some $9.3bn, it is currently under construction and is expected be commissioned in 2025.

Figure 1: Upcoming oil and gas project starts in China by sector, 2021–2025
Source: GlobalData

News Item details

Journal title: Petroleum Review

Countries: China -

Subjects: Petrochemicals - Oil and gas - Construction - Forecasting -

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