China opens oil products wholesale business to foreign JVs

11 June 2007

Mumbai: China has for the first time granted oil products wholesale licences to two joint ventures with overseas companies in a bid to ensure a more competitive market, the state media reported.

The two firms are Sinopec Senmei (Fujian) Petroleum Co Ltd and Fujian Refining & Petrochemical Co Ltd.

The Fujian refining and ethylene joint venture project will expand the existing refinery capacity from four million tonnes to 12 million tonnes per year. It is expected to start up in early 2009.

Sinopec Senmei will manage and operate 750 gas filling stations and 11 oil tankers in southeastern province of Fujian as of July 1.

China issued such licences to the first batch of eight state-owned and private companies late last month since it opened the oil products wholesale market last December in line with its commitments to joining the World Trade Organisation.

The entry of these joint venture refiners would help foster more competitive oil products wholesale market where around two-thirds of the oil products'' wholesale business is controlled by the nation''s two oil giants, the China National Petroleum Corporation and China Petrochemical Corporation (Sinopec).