Shell decides to expand China petrochemical complex

A venture between CNOOC Petrochemicals Investment Ltd and Shell Nanhai B.V., CNOOC and Shell Petrochemicals Company Limited (CSPC) has made a final investment decision to increase its petrochemical complex.

The Daya Bay petrochemical complex in southern China will gain a third cracker capable of producing some 1.6 million tonnes of ethylene per year.

Ethylene is a key ingredient for plastics and other downstream materials like linear alpha olefins, which are used to make synthetic lubricants like Shell’s Omala gear oil. The investment also covers a further facility capable of producing speciality high performance chemicals at a rate of 320,000 tonnes annually. These include many chemicals that are vital for daily life, such as carbonate solvents and polycarbonates. Indeed, carbonate solvents are needed to make the lithium-ion that power everything from mobile phones to electric vehicles.

The director for renewables, downstream and energy solutions at Shell, Huibert Vigeveno, said that CSPC had become one of the biggest joint petrochemical projects in China, having provided the market with valuable products for over 20 years. He added:

“This new investment is a key enabler to realise CSPC’s transformation strategy towards more premium and highly differentiated chemical products. It is consistent with Shell Chemicals & Products’ strategy to pursue targeted growth at advantaged locations. It also demonstrates our strong partnership with CNOOC.”

The new facilities will mainly seek to meet the rapidly growing demand in the Chinese market. They will produce chemicals with applications in sectors like healthcare, industry, agriculture, consumer goods and construction.

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