CNOOC-Shell JV take FID on Huizhou ethylene expansion

Royal Dutch Shell PLC subsidiary Shell Nanhai BV and China National Offshore Oil Corp. (CNOOC) have taken final investment decision on the companies’ previously announced plan to expand capacity at their 50-50 joint venture CNOOC & Shell Petrochemicals Co. Ltd.’s (CSPC) petrochemical complex in the Daya Bay Economic and Technological Development Zone, Huizhou, Guangdong Province, China (OGJ Online, Dec. 15, 2015).

As part of the Mar. 21 FID, which follows a heads of agreement signed by the partners in late 2015, CSPC will take over CNOOC’s current project to build additional chemical production installations adjacent to the CSPC’s existing Nanhai petrochemical complex, the companies said.

Alongside ongoing construction of an ethylene cracker and ethylene derivatives units that will increase ethylene capacity by more than 1 million tonnes/year, or about double the complex’s current capacity (OGJ Online, Dec. 20, 2013), the expansion also includes construction of what will be China’s largest styrene monomer and propylene oxide (SMPO) plant.

The expanded complex, once completed, will use Shell’s proprietary OMEGA, SMPO, and Polyols technologies for the first time in China to produce the following: ethylene oxide, 150,000 tpy; ethylene glycol, 480,000 tpy; and high-quality polyols, 600,000 tpy.

In addition to improving the complex’s overall energy efficiency and quality of production, the expansion complements CSPC’s aim of meeting China’s growing domestic demand for petrochemical products, CNOOC and Shell said.

Current production capacities at the Nanhai complex include: ethylene, 950,000 tpy; propylene, 500,000 tpy; butadiene, 165,000 tpy; low-density polyethylene, 250,000 tpy; high-density polyethylene, 260,000 tpy; polypropylene, 260,000 tpy; monoethylene glycol, 350,000 tpy; styrene monomer, 640,000 tpy; propylene oxide, 290,000 tpy; polyols, 170,000 tpy; and propylene glycol, 60,000 tpy.

Pending all regulatory approvals, expanded operations at the Nanhai complex are due to be commissioned in 2 years, the companies said in December 2015.

Project overview

The total expansion project, which also includes CNOOC’s ongoing Phase-2 expansion and integration of its nearby 12 million-tpy Huizhou refinery (OGJ Online, Feb. 3, 2015), will include 12 new petrochemical units for the following processes:

• Ethylene cracking.

• Pyrolysis gasoline hydrogenation.

• Butadiene extraction.

• Methyl tertiary butyl ether (MTBE), 1-Butene recovery.

• High-density polyethylene production.

• Co-polypropylene production.

• Linear low-density polyethylene production.

• Olefin conversion.

• Phenol acetone production.

• Butanol, octanol production.

• Ethylene oxide, ethylene glycol production.

• SMPO production.

At the end of February, overall progress on the Phase 2 expansion of the Huizhou refinery was 48.21% completed, CNOOC said.

Contact Robert Brelsford at rbrelsford@ogjonline.com.

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