December 26, 2019 / 1:11 AM / 5 months ago

China sets first round of 2020 non-state crude import quotas at 103.83 million tonnes

BEIJING/SINGAPORE (Reuters) - China has issued a first round of crude oil import quotas for private firms next year that will allow non-state refiners to ship in 103.83 million tonnes of crude, state media and industry sources said on Thursday.

That level is up 8% from the 96.25 million tonnes issued in the first batch of non-state firm import quotas for 2019, according to Shanghai Securities News and Beijing-based energy consultancy SIA Energy.

The bulk of the increase will go to new mega-refinery projects that started up in the past couple of years.

Hengli Petrochemical received a first-round quota for 10 million tonnes of crude, according to trade sources. That is more than double the 4 million tonnes it received in the first batch last year when the refinery was starting up, according to trade data.

Hengli’s first-round batch is already a hefty chunk compared with its total quota allocation for 2019 of 16.8 million tonnes.

Elsewhere, Zhejiang Petrochemical Company (ZPC), which has recently started up a second crude distillation unit (CDU), received a quota of 8 million tonnes in the first batch for 2020. That was up from 7.5 million tonnes in 2019’s first round, trade data showed.

The quotas were broadly in line with expectations, SIA Energy consultant Seng Yick Tee said. China’s commerce ministry said in November that non-state crude oil import quotas for the whole of 2020 would be 202 million tonnes, the same as for 2019.

“The focus in 2020 will be ZPC’s commercial runs and also Sinopec Zhanjiang refinery,” he said, referring to a new 200,000 barrels per day plant that is expected to start up in second-quarter 2020.

Meanwhile first-batch 2020 crude import quota for state-owned ChemChina and most other independent refineries were either reduced or unchanged.

ChemChina received 8.52 million tonnes, 8% lower than its first-round quota in 2019, while Baota Petrochemical received no first-round quota for 2020, trade data showed.

Refineries which received a near-30% cut in first-round crude import quotas for 2020 versus the same period last year included Kenli Petrochemical, Lijin Petrochemical, Wonfull Petrochemical, Qirun Petrochemical, Hengyuan Petrochemical, Shengxing Petrochemical.

Reporting by Hallie Gu and Tom Daly in Beijing and Florence Tan in Singapore; Editing by Himani Sarkar and Kenneth Maxwell

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