Chinese petchem firms, refiners expand cracker capacity

Market: LPG, Oil products, Petrochemicals
28/07/20

Three new large steam crackers are on course to start up in China in August, boosting demand for petrochemical feedstocks such as naphtha and LPG.

Bora Chemical is due to be the first company to start its cracker, followed by state-controlled Sinopec's new Zhanjiang refining arm and state-owned Sinochem's Quanzhou operations.

Bora LyondellBasell, a 50:50 joint venture between global petrochemical firm LyondellBasell and local refinery Bora Chemical, started trial runs at its steam cracker on 27 July, according to market participants. This could not be confirmed with the company. The official start-up has been scheduled for 2 August.

The cracker, at Panjin in northeast China's Liaoning province, has 1.1mn t/yr of ethylene and 690,000 t/yr of propylene capacity. Its derivative units include 120,000 t/yr of butadiene (BD), 450,000 t/yr of linear low-density polyethylene (LLDPE), 350,000 t/yr of high-density polyethylene (HDPE), 350,000 t/yr of styrene monomer (SM) and 600,000 t/yr of polypropylene (PP).

The company plans to start up downstream PE and PP units together with the cracker, fed by purchased ethylene and propylene in the initial stage. The BD capacity is scheduled to start on 7 August. The SM capacity is in the process of starting up and Bora achieved on-specification production of ethylbenzene, a feedstock for SM, on 27 July.

Bora LyondellBasell's new cracker will run partly on merchant propane, which is estimated to make up around 44pc of its cracker feed slate. The remaining 56pc will mainly comprise naphtha and a small amount of light hydrocarbons from Bora's 140,000 b/d Panjin refinery.

The joint venture's sales agreement calls for Bora Chemical to market the LLDPE and SM, while LyondellBasell will market the HDPE and PP.

Two other crackers are poised to come on line next month. State-controlled Sinopec has set a 21 August date to start its naphtha cracker at Zhanjiang in Guangdong province. The cracker has 800,000 t/yr of ethylene and 430,000 t/yr of propylene capacity and is integrated with 250,000/400,000 t/yr ethylene oxide/ethylene glycol (EO/EG), 350,000 t/yr HDPE, 100,000 t/yr ethylene vinyl acetate (EVA) and 550,000 t/yr PP derivative units.

And fellow state-controlled firm Sinochem is now looking to start up its Quanzhou naphtha cracker at the end of August. The cracker has 1mn t/yr of ethylene and 500,000 t/yr of propylene capacity, and a full stream of petrochemical derivative units including 100,000 t/yr EVA, 400,000 t/yr HDPE, 200,000/450,000 propylene oxide/styrene (PO/SM), 580,000 t/yr PP and 120,000 t/yr BD capacity.

Sinopec Zhanjiang is buying LPG for its new cracker, while Sinochem has its own LPG supplies from the Quanzhou refinery. LPG is likely to make up about 10pc of the crackers' feedstock mixes.

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