Sinopec develops MTO, biodiesel technologies

30 October 2007 05:31  [Source: ICIS news]

SINGAPORE (ICIS news)--Chinese petrochemical major Sinopec is developing a methanol-to-olefins (MTO) and biodiesel technologies which may reduce its reliance on crude oil, a top executive said on Tuesday.

The company has built pilot plants based on the two technologies and was evaluating their feasibility, Sinopec’s chief financial officer (CFO) Dai Houliang said in a teleconference.

“We have made good progress [on the biodiesel technology],” he said in Mandarin, adding that the company was looking at commercialising the technology.

High crude oil prices have dampened the company’s refining earnings in the third quarter and it has also increased a levy paid to the government for locally produced oil.

Sinopec paid a levy of yuan (CNY) 3.5bn ($468.5m) in the third quarter, which totaled CNY7.1bn in the first nine months this year, Dai said.

China’s cap on petroleum prices has often led to losses among refiners in the country when crude costs surge.

Sinopec, which is developing a gas pipeline from Sichuan to Shanghai, planned to use natural gas to replace fuel used at its refineries and petrochemical plants, Dai said.

It has also reserved 1bn m3 of natural gas from the Puguang field in Dazhou for domestic use in Sichuan province and also for chemical development, he added.  

Sinopec signed a letter of intent with the Dazhou government late last year to invest in a CNY8bn MTO project producing 1.8m tonnes/year of methanol and 600,000 tonnes/year of ethylene and propylene.

China’s ban on the use of natural gas as petrochemical feedstock was unlikely to affect the MTO project, Dai said, adding that some projects were encouraged.

($1=CNY7.47)

By: Florence Tan
+65 6780 4359

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