UPDATE 1-Cosmo Oil hopes to restart quake-hit CDU soon

* Restart of Chiba No.2 CDU hinges on local approval

* Expects restart of another CDU in April (Adds details)

TOKYO Feb 2 (Reuters) - Japan's Cosmo Oil Co hopes to resume operations of the 120,000 barrels per day No.2 crude distillation unit (CDU) at its quake-hit Chiba refinery soon, but is still awaiting approval from the local government, Managing Executive Officer Satoshi Miyamoto said at a news conference on Thursday.

The 220,000 barrels per day (bpd) Chiba refinery, east of Tokyo, resumed partial refining operations from Jan. 12 for the first time since fire engulfed 17 of its 25 liquefied petroleum gas (LPG) tanks following a massive earthquake last March.

The main facilities, the two crude distillation units (CDUs), remain shut, however. The company had previously aimed to restart the No.2 CDU in early January, but has been delayed as it awaits approval from the local authorities.

Miyamoto did not give a detailed schedule for the No.2 CDU's restart, but the company is expected to process crude at a below-capacity 90,000 bpd when it resumes operations.

Cosmo expects eight undamaged LPG tanks to be ready for operations by April 1, when it would be ready to restart the 100,000 bpd No.1 CDU and process a total 150,000 to 180,000 bpd of crude at the two CDUs, company sources said.

The company in January resumed work on replacing the 17 fire-damaged LPG tanks with new ones, with completion scheduled in about a year, a company official said.

The Chiba refinery began producing low-sulphur fuel oil, used in power generation, among others, last month after it restarted the 36,000 barrels per day No.10 fuel oil hydro-desulphurisation unit, the No.20 hydrogen producing unit with capacity of 880,000 cubic meters. (Reporting by Osumu Tsukimori; Editing by Chris Gallagher)