China’s crude throughput has started to fall in March with refinery maintenance kicking in since late February, and likely to continue over April-June, latest industry data and information collected by S&P Global Platts showed.
A combined capacity of 36 million mt/year of refining capacity at five state-owned refineries has been offline till late March, including four from Sinopec and one from CNOOC.
These included Sinopec’s Yanshan Petrochemical, Jinan Petrochemical, Changling Petrochemical and Jinling Petrochemical, with Jiujiang Petrochemical postponing the maintenance from March till April.
The start of the maintenance has trimmed down March run rate at the four state-owned oil majors — Sinopec, PetroChina, CNOOC and Sinochem to 78.8%, compared with a seven-month high of 82.8% in February, according to Platts data.
However, the March run rate was still nine percentage points higher from 70% seen in March 2020, when product demand had recovered slightly from the initial spread of the COVID-19.
April could see another three refineries with a capacity of 25 million mt/year undergoing turnaround, with three more of 18.5 million mt/year capacity to follow in May, and another one 10 million mt/year capacity to go offline in June.
The heavy maintenance season, which will be carried into the second half, will help ease the pressure on product sales both internally and externally to some extent.
Sinopec, CNOOC see biggest drop
The four state-run oil majors planned to process a combined 7.15 million b/d of crude oil in March, accounting for 78.8% of their nameplate capacity of 9.08 million b/d. In comparison, the four oil majors had processed 7.39 million b/d of crude in February, or 82.8% of their combined nameplate capacity.
Sinopec and CNOOC contributed to most of the crude throughput fall, mainly because of the maintenance.
The average run rates at Sinopec fell to 82% in March from around 86% in February, while shutdowns at CNOOC’s Huizhou Petrochemical 10 million mt/year Phase 2 project, has trimmed down the overall run rates at the refinery to around 59%, from 98% in February.
On the other hand, average run rate at PetroChina’s surveyed refineries was stable at around 75%, unchanged from last month.
Data from 39 state refineries was collected in March, same as February. These include 20 Sinopec refineries, 17 PetroChina refineries, CNOOC’s Huizhou Petrochemical and Sinochem’s Quanzhou Petrochemical refinery.
PetroChina’s Dalian Wepec has raised run rates by about 11 percentage points from February, as it needs to kick up throughputs in order to hit the annual target of 9 million mt, according to a company source. But this was offset by Sichuan Petrochemical in southwestern China, which has lowered run rates by 10 percentage points, due mainly to insufficient crude feedstock.
Independent refineries largely stable
In contrast to state-owned oil majors, run rate at China’s independent refineries have been less volatile.
The 20 million mt/year Hengli refinery in Northeastern China has been operating at a run rate of around 108% capacity, more or less unstable from last month, “which was the most economic scale,” said a company source.
The run rate at ZPC has been around 80% at its three 10 million mt/year CDUs, with the fourth 10 million mt/year CDU to get started in Q2, according to a company source. This was slightly higher with around 70% in the previous month.
On the other hand, run rate at the 45 small-sized private sector refineries in eastern Shandong province, was lower slightly at around 74.6% as of March 17, compared with 79.3% in February, according to local information provider JLC.
“With refinery maintenance started, the run rate is likely to go down further in April,” said an analyst with JLC.
A combined capacity of 19.5 million mt/year is likely to go offline from April from four independent refineries, with another 18.5 million mt/year to be shut over May-June.
STATE-OWNED REFINERS’ SCHEDULED MAINTENANCE STARTS IN 2021
**Sinopec’s Changling Petrochemical has shut for a 55-day maintenance that began around Feb. 19.
**Sinopec’s Jinan Petrochemical has shut the entire refinery for maintenance from late February, to last till early April.
**CNOOC’s Huizhou Petrochemical will shut the Phase 2 refinery of 10 million mt/year capacity for maintenance over March 4-April 22.
**Sinopec’s Jinling Petrochemical has shut the 3 million mt/year and a delayed coker for maintenance, from around March 11 to last till end April.
**Sinopec’s Yanshan Petrochemical will shut a 8 million mt/year CDU for maintenance over late March-mid May.
**PetroChina’s Fushun Petrochemical will be shut for an overall maintenance from April 10 for 45 days.
**Sinopec’s Jiujiang Petrochemical will be shut for maintenance over April-May.
**Sinopec’s Shanghai Petrochemical will shut a 6 million mt/year CDU and secondary units for maintenance over April-June, with a few secondary units starting in March.
**Sinopec’s Yangtze Petrochemical will shut some secondary units for maintenance over April-May.
**PetroChina’s Jilin Petrochemical will shut for maintenance over May-June.
**PetroChina’s Dagang Petrochemical will shut for maintenance over mid-May and end June.
**Sinopec’s Cangzhou Petrochemical will shut the entire refinery for maintenance over May 10-June 30.
**Sinopec’s Maoming Petrochemical will shut a 10 million mt/year CDU for maintenance over early-June till mid-July.
**Sinopec’s Qilu Petrochemical will shut a 4 million mt/year CDU for maintenance from mid-August till late September.
**Sinopec’s Shijiazhuang Petrochemical will be shut for an overall maintenance over end-August till end-October.
**Sinopec’s Guangzhou Petrochemical will shut a 8 million mt/year CDU for maintenance over mid-October-end November.
**Sinopec’s Gaoqiao Petrochemical will shut the entire refinery for maintenance over end October-early December.
**Sinopec’s Fujian Refining & Petrochemical will shut a 4 million mt/year CDU for maintenance over mid- October-mid-November.
Source: Platts