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Sinopec, China's second largest oil company, and ExxonMobil, the largest oil company in the world, agreed to push harder for their multi-billion-dollar petrochemical and oil product joint ventures in East China's Fujian Province and South China's Guangdong Province.
The two companies signed a framework agreement in New York to strengthen their strategic alliance yesterday, following the recent approval by the Chinese Government on the US$3 billion petroleum and petrochemical joint venture between ExxonMobil, Sinopec, Fujian Province and Saudi Aramco.
The petroleum and petrochemical complex plans to expand the capacity of an existing refinery from 4 million tons a year to 12 million tons.
It will also build a new ethylene production facility with an annual output of 800,000 tons, which will be one of the largest in Asia upon completion.
Under the alliance, the four parties will also work on a fuel marketing joint venture that would operate about 600 service stations in Fujian.
In both joint ventures, ExxonMobil and Aramco will each hold a 25 percent stake, while Fujian Petrochemical Co Ltd, a joint venture between Sinopec and the Fujian provincial government, will hold the remaining half.
"It is another important milestone since the establishment of the strategic alliance between our two companies in 2000," said Sinopec Chairman Li Yizhong in a statement.
"I believe that after the signing of this framework agreement, we will further strengthen and broaden our co-operative relationship and achieve the various objectives laid out in the agreement," he said.
The statement also said the two companies have been evaluating a joint venture that will invest in and expand Sinopec's existing refinery and petrochemical facilities in Guangdong Province.
They also plan to establish a fuel marketing joint venture in the province to run 500 petrol stations in the three years following the establishment of the joint venture.
(China Daily October 23, 2002)
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