Chinese oil and gas company Sinopec Group is reportedly planning to invest CNY200bn ($29.05bn) to upgrade its four main oil refineries in the country through 2020.
The investment is intended to help the firm produce higher-quality fuels at the four refineries which are located in the cities of Shanghai, Nanjing, Zhenhai on the east coast, and Maoming-Zhanjiang in southern Guangdong province.
Sinopec was quoted by Nikkei Asian Review as saying that the upgrade work is expected to increase the refineries’ combined annual processing capacity by 30% to 130 million tons of crude oil a year.
As part of the investment plan, the refineries will also be installed with new equipment to increase production ethylene capacity from 5 million tons to 9 million tons per year.
Sinopec chairman Wang Yupu was quoted by Reuters as saying in a statement: “It’s a strategic move that fits the global industrial trend for clustered and scaled growth and helps transform China’s petrochemical products to medium and high quality.”
The state-run refining and petrochemical giant expects the upgrades to allow it to more efficiently operate the four plants and generate revenue of CNY800bn ($116.1bn) by 2020.
The firm has already commenced upgrade work at the greenfield oil refinery and petrochemical complex in Maoming-Zhanjiang.
Upon completion of the work, the refinery will have capacity to produce gasoline and aviation fuel at the expense of diesel.
In 2015, Sinopec announced the completion of $1bn expansion program at a refinery located in Jiangxi province in eastern China. The upgrade project involved addition of 100,000 barrels per day (bpd) crude unit.