Tag Archives: MimbolovePetrochina
Here is a report from AFP, which pretty much covers the story of the latest fire at PetroChina’s Dalian refinery. As more information comes in, we will post it here.
A major fire broke out Monday at a refinery in northeast China owned by state-owned oil giant PetroChina, the official Xinhua news agency reported, in the latest disaster to hit the country’s oil industry.
It took nearly 300 firefighters several hours to put out the blaze, which broke out when an oil storage facility caught light at at around 10:00 am (0200 GMT), Xinhua said, adding that no casualties had been reported.
The fire was the second to hit the refinery in the coastal city of Dalian in as many months and follows a series of other disasters involving China’s rapidly expanding oil industry, which has come under scrutiny over its safety standards.
In July 2010, two pipelines exploded at a PetroChina oil storage depot in Dalian, also triggering a devastating spill.
The government estimated about 1,500 tonnes of oil poured into the Yellow Sea after the fire, but environmental watchdog Greenpeace said up to 60 times that amount may have escaped.
And in January this year, more than 30 people were injured when an explosion ripped through a PetroChina oil refinery in neighbouring Fushun city.
A spokesman for the company who declined to be named confirmed that Monday’s blaze was at the same refinery that was hit by a fire in July, but refused to provide any more details.
The world’s second-largest economy is also grappling with a huge spill from oil platforms jointly owned by state-owned CNOOC and US oil giant ConocoPhillips that have polluted large parts of Bohai Bay off the east coast.
Dalian, a major Chinese port and transport hub, sits at the confluence of Bohai Bay and the Yellow Sea about 460 kilometres (290 miles) east of Beijing.
According to state press reports, the Dalian refinery, PetroChina?s largest, has three crude distillation units with total crude processing capacity of 410,000 barrels per day.
Telephone calls to the Dalian plant and to local authorities went unanswered.
Reports are coming in of a major fire at a Petrochina refinery in Dalian. The fire is apparently still out of control. More details later.
Reports are emerging that a major explosion has occurred at Petrochina’s Fushun oil refinery. Fushun is in far northern China.
The reports are indicating that the explosion occurred in the residue FCC at number 2 refinery, at about 9.30am this morning local time.
The number 2 refinery can process up to 8 million tonnes of crude oil per year. Its coker processes up to 2.4 million tonnes.
I will add more information as it becomes available.
Update: reports say that 30 people were injured in the explosion. Apparently the main part of the refinery is still operating. Plant management does not want to stop the process, because it would be impossible to restart until ambient temperatures rise sufficiently. (It is currently -7c here in Beijing, so how much colder must it be way up north?!)
There are separate reports of an explosion at Jilin refinery, which is also in North China, not so far from Fushun. However, it is not clear whether these reports are confusing refineries, or whether there was a separate unrelated incident. More to come.
Production of green petroleum coke in China gained in November, as refiners sought to ease shortages in diesel.
Petcoke production in November was a record 1.81mt, compared to 1.735mt in October.
Both major producers pledged recently that they would ramp up processing of crude oil, in response to dire shortages of diesel fuel, especially in the east and south of China. The fuel shortages were caused, at least in part, by people switching to diesel generators, as the authorities were restricting electricity supply to meet 5-year plan targets.
All that extra crude oil has led to increased amounts of green coke being produced in November. Sinopec put out 1.052 million tonnes of green coke last month, compared to 1.045 in October, despite October being a day longer.
Sinopec gained on the efforts of 8 of their refineries, but especially because Cangzhou refinery in Hebei returned from its maintenance shutdown. Next month may be a little lower, however, as the shutdown in Gaoqiao takes effect.
CNPC, or PetroChina, produced 275,000 tonnes, compared to 231,000 in October. This increase came mainly from Jinxi refinery in Liaoning province returning from turnaround.
CNOOC produced 137,000t compared to 124,000t the previous month.
The local independent, or tea kettle refineries, produced 347,000t compared to 330,000t in October.
For the year to the end of November, China has produced 17.7mt, so will likely fall just short of breaking the 20mt mark for 2010.
Not surprisingly, coke prices have softened a touch recently, but we don’t expect that to last long.
A fire has broken out at the same CNPC (PetroChina) terminal in Dalian as the major oil spill in July.
Local media has reported that the fire was in an oil storage tank that had been emptied prior to dismantling. There were no reports of environmental damage, although firemen reported that strong winds were hampering their efforts to put out the fire.
The terminal in Dalian suffered an explosion in a pipeline in July, which according to some sources, caused 60,000 tonnes of oil to escape into the sea there.
The reports of this fire did not mention any disruption to oil supply or processing.
Chalco signed a purchasing agreement with Sinopec last week. According to the agreement, Sinopec will supply Chalco with 800,000 to 1,200,000 tonnes of high quality coke annually.
This is following the deal that Chalco signed with Petrochina at the end of last year, for a similar quantity. At that time, it had been reported that Chalco approached Sinopec first, but that the two parties could not agree. That led to Chalco approaching Petrochina. It seems Sinopec has seen the better wisdom of dong the deal.
No details as to the period of the agreement, or the pricing mechanism.
Chalco now has approximately 2 million tonnes of coke under contract. Assuming Chinese recovery rates for calcined coke, this volume of coke covers all of Chalco’s capacity, and more than covers their current production levels.
For the foreign market, it also reduces the the ability of the Chinese suppliers to support export sales, as either green or calcined. Although there is no great change in volume to be consumed inside China – Chalco was going to consume coke in its smelters anyway – what this does is create a blanket order for the winning refineries that they will be required to fill first. On Chalco’s part, they will no doubt cherry pick to get the best blends.
Market demand for alumina has increased with the recent resumption of aluminium production. Last week, alumina prices rose slightly. Imported alumina prices were up US$5-10/tonne to US$250-265/tonne. The domestic non-Chalco alumina price rose RMB20-50/tonne to RMB2350-2370/tonne. The Chalco price remained unchanged at RMB2300/tonne.
The situation on the Chinese aluminium market changed last week following the completion of the government reserves purchases program. Production capacity coming back on line has pushed up market supply, while demand remained weak -and this resulted in a drop in Chalco`s aluminium price, RMB 900-1100/tonne to RMB13800/tonne. Meanwhile, Guangdong province saw the lowest domestic non-Chalco price at RMB13420/tonne, and we even saw some low-end aluminium priced at RMB13300/tonne.
Green Petroleum Coke
Last week saw fluctuations within the coke market. However, more refineries lowered their prices than raised their prices, and the market remains set on a downturn trend.
On the supply side, both Sinopec and Petrochina have been gradually increasing the volume of crude oil being processed since March. As a result, coke production has seen significant growth in Eastern and Southern China. Going forward, crude oil processing volumes will likely continue to grow given the upward trend in the refined oil products market lately, and coke output should increase further as cokers in local refineries with output capacity of around 5 million tonnes fully resumed production last week. Although domestic supply of coke may begin to decline after May, with the Changling, Zhenhai and Liaoyang petrochemical plants shut down for overhauling and maintenance, significant quantities of imported coke are expected to come in between the end of April and May. This supply, combined with coke imported earlier and still in inventory, is expected to result in significant supply of petroleum coke in China over coming months.
On the demand side, the market for coke remains soft. First, the Chinese government’s primary aluminum reserves purchase program has come to an end, and with this the domestic aluminium market has begun to weaken again, leading to weaker downstream demand for coke. Second, customs data show a 50% drop in anode and electrode exports over the first two months of 2009 compared with the same period last year, and the slump in export markets is expected to extend into May 2009. Third, over 50% of China’s steel sector’s output has been suspended, causing a sharp decrease in demand for coke from the electrode industry. Finally, the demand for coke from industrial silicon producers and other sectors is expected to remain subdued. Overall, the outlook for coke downstream demand is therefore relatively negative, and it is not anticipated the situation will improve anytime soon.
To sum things up, the recent price rebound at some refineries lacks support, and the current situation will make it difficult to curb the downward pricing trend for petroleum coke. The coke market is expected to stay weak while it consolidates.
Quoted prices for low sulphur and high sulphur calcined coke remained unchanged last week. Low sulphur CPC saw a slight decrease in deal prices, but was mostly these trades were for export. Jinxi low sulphur CPC was selling for as low as RMB2000/tonne, while their GPC sold for RMB1500/tonne. In some cases, high sulphur CPC prices rose last week, driven up by rising high sulphur GPC prices (from Gaoqiao Petro-chemical, Shanghai Petro-chemical, and Qingdao Petro-chemical).
On the other hand, moderate sulphur calcined coke prices dropped RMB100/tonne to RMB1400-1500/tonne as a result of the soft aluminium market.
Nothing to report
Coal tar prices continued to rise last week. The price in Shanxi province increased RMB200-300/tonne to RMB2500/tonne, and rose to RMB2200/tonne, while in Hunan province, while Hebei, Shandong, and Zhejiang provinces prices edged up RMB400/tonne to RMB2600-2800/tonne.
Market supply remains very tight.
Coal Tar Pitch
Domestic coal tar pitch prices continued to rise last week along with coal tar prices. In Shanxi province, modified pitch prices rose RMB300/tonne to RMB2700-2800/tonne, and moderate temperature pitch prices rose RMB150-300/tonne to RMB2500/tonne. In Hebei province, modified pitch prices rose RMB300-400/tonne to RMB2800/tonne, while the price for moderate temperature pitch remained unchanged at RMB2400/tonne. In Shandong province, modified pitch prices rose RMB100-150/tonne to RMB2700/tonne.
Coal tar pitch prices are expected to rise further going forward.
Most producers have kept their prices stable, with the exception of a supplier from Shanxi province who has cut its 30% graphite block price by RMB200/tonne, to RMB 7600/tonne.
The market for aluminium fluoride has been relatively stable lately. Listed prices for aluminium fluoride were RMB4800-5500/tonne, and the gap between listed and traded prices has further narrowed since the beginning of April. Quoted prices for aluminium fluoride (dry method) were RMB5000/tonne in Henan province (except for Do Fu Do), RMB4900/tonne in Shandong province, and RMB4800/tonne in Zhejiang province. In Fujian province, the production of aluminium fluoride was stable, and quoted prices stood at RMB5200/tonne for the domestic market, and at USD1120/tonne FOB for the export market. The list price for wet method fluoride stayed unchanged at RMB4500/tonne.
The purchasing price for the raw material that is aluminum hydroxide has slightly increased -it currently stands at RMB1300-1550/tonne. This rise in raw materials may push aluminium fluoride prices up. The latest quotation for cryolite was RMB5000-5800/tonne.