Page 14 - AsianOil Annual Review 2021

AsianOil JUNE AsianOil

Sinopec prepares

for greener future

The refiner is investing in both petrochemicals and hydrogen
as it plans for a decline in transportation fuel demand

EAST ASIA AS China strives to reduce its carbon footprint, also expanding petrochemical production. Con-
with the country aiming to reach peak emissions struction is slated for completion in 2023.
WHAT: by 2030 and carbon neutrality by 2060, state- “While maintaining the same crude process-
Sinopec has announced a owned Sinopec is shifting its corporate priorities ing capacity and without increasing emissions of
new refinery upgrade and to match. pollutants, the upgrade will raise output of pre-
green hydrogen project. Asia’s largest refinery is increasingly preoc- mium quality refined fuel,” the state refiner said.
cupied with diversifying its revenue streams, Sinopec, along with many of its state and
WHY: through both greater investment in petrochem- privately owned downstream compatriots, is
The company expects oil icals ahead of an anticipated collapse in fuel investing more heavily in petrochemicals ahead
product demand to peak demand as well as in the clean energies that will of an anticipated peak in oil demand in the next
by the end of the decade. ultimately replace fossil fuels altogether. decade.
Sinopec announced in June a multi-million The major warned in December 2020 that
WHAT NEXT: dollar upgrade for one of its existing refineries China’s oil product demand would reach its
Investment in commercial in eastern China, aimed at boosting the facili- zenith by 2025, with an expansion in crude runs
grade CCS technology is ty’s production of higher-quality fuels as well as likely to be driven by rising petrochemical pro-
needed to capitalise on petrochemicals. duction. The world’s refiners are acutely aware
Sinopec’s grey hydrogen But even as the company retools its existing that between various countries’ bans on the sale
production. downstream assets, Sinopec’s longer-term ambi- of new international combustion engines (ICEs)
tions lie with hydrogen, of which it is already a and the proliferation of new energy vehicles
major producer. (NEVs) oil product demand has a limited shelf
life.
Petchem revamp Petrochemicals, on the other hand, will not
Sinopec said on June 1 that it had launched a be so easily replaced. McKinsey Energy Insights
CNY5.17bn ($808.9mn) upgrade of Nanjing has predicted that the petrochemicals sector will
City-based subsidiary Yangtze Petrochemical’s be the most important growth driver for global
282,000 barrel per day (bpd) facility. oil demand between 2020 and 2030. It argues
The investment covers eight facilities, includ- that developing countries’ usage of plastics con-
ing a 2.6mn tonne per year residue hydrocracker tinues will help to drive the sector forward.
and a 2.8mn tpy catalytic cracker, and aims to Sinopec’s greater focus on the petrochemicals
boost production of higher quality fuels while sector is far from the company’s central goal,

P14 www. NEWSBASE .com Annual Review 2021