ZPC pushes China independent refiners’ Dec crude imports to record high

Crude imports for China’s independent refineries increased by 18.6% on the month in December to hit a fresh record of 14.12 million mt, or 3.3 million b/d, as Zhejiang Petroleum Chemical took more cargoes after its full startup in December, a monthly survey by S&P Global Platts survey showed.

The December crude imports were also 1.6% higher than the last record of 13.9 million mt registered in October.

About 53% of the month-on-month increase was contributed by ZPC, which ramped up crude imports in December when it fully commenced its 20 million mt/year facility.

ZPC has received about 1.44 million mt of imported crude oil in seven cargoes, which surged 422.5% from 276,000 mt received in November. On a year-on-year basis, it was up 454.6%.

Its shipments included two cargoes from Saudi Arabia, and each cargo of Kuwait, Iraqi Basrah Light, Iraqi KBT, Angolan Clov and Russian Urals.

This led ZPC to become the third biggest crude oil importer in the independent sector in December.

The company in January is expected to receive 1.95 million mt of crude. Four of the VLCC arrivals will be from Saudi Arabia, including three cargoes of Arab Medium and one cargo of Arab Heavy. In addition, one VLCC of Oman crude, one VLCC of Kuwait crude, and another one VLCC is also expected to arrive later this month, according to port sources.

Taking all the December crude arrivals into account, the company has imported a total of 4.71 million mt of crudes in 2019, with about 12 different grades, according to the Platts survey. Among these, crudes from Saudi Arabia account for about 41% of the total imports.

2019 IMPORTS UP 25% ON YEAR

China’s crude imports over January-December 2019 for independent refineries totaled 132.26 million mt, about 25% higher from 105.6 million mt in 2018.

The strong growth started in May when the other refining and petrochemical giant, the 20 million mt/year Hengli Petrochemical (Dalian) was fully online.

The average imports over May-November 2019 was at 11.37 million mt, 17.9% higher from the average imports of 9.64 million mt over January-April 2019.

In 2020, monthly average crude imports for the independent refineries will climb up to a new level to probably above 13 million mt due to the full commission of ZPC in December, according to refining sources.

QINGDAO HANDLES 38% OF SHIPMENTS

With more arrivals for ZPC, crude imports via Zhoushan port will gradually increase, bringing down the proportion of crude oil imports handled by Qingdao.

In December, crude shipment arrivals via Qingdao port and Dongjiakou port accounted for 37.6% of the independent sector’s total intake, down from 45% in November.

The volume, however, edged down by only 1% on the month to 5.3 million mt in December.

Till early January 2020, two cargoes of crude that arrived in late October, were still held up in Qingdao port for unknown reasons.

The two cargoes, loaded via 150,000-dwt vessels Samsara and Smyrni, were originally designated for Shengxing Petrochemical, according to sources.

The Platts December survey covers crude barrels imported by 38 refineries with import quotas, as well as others without quotas, through ports mostly in Shandong province, as well as Tianjin, Zhoushan and Dalian for the sector.

The barrels include those imported directly by the refiners, as well as cargoes bought by trading companies on behalf of the independent refiners.

The 38 refiners had been awarded a combined total of 133.65 million mt of import quotas in 2019, accounting for 84% of the county’s total allocations for independent refineries in three batches.
Source: Platts