China allocates third batch of crude oil import quotas totaling 12.9 mil mt

China has allotted a third batch of crude import quotas to 19 qualified refineries, totaling 12.9 million mt, according to a document seen by S&P Global Platts Tuesday.

 

This new allocation brings the total quotas awarded so far this year to 159.74 million mt for 45 refineries.

 

The year-to-date allocations account for about 88.8% of the refiners’ annual ceiling quotas, totaling 179.94 million mt, which has been set by the National Development and Reform Commission.

 

The 20 million mt/year greenfield Zhejiang Petroleum and Chemical, or ZPC, has won 3.5 million mt in quotas in the latest round ahead of it full commissioning in December — the highest volume received among the refineries.

 

In addition to the volumes it had in the first round, the company currently holds 7.5 million mt, accounting for 37.5% of its ceiling quota. The company did not apply for quota in the second round.

 

With the new allocations, 18 more refineries have hit their ceiling in quota volumes, in addition to the 18 which had hit the ceiling in the second batch.

 

The remaining nine refineries are unlikely to reach their ceiling allocation for 2019 as no new round of allocation is expected by the end of the year.

 

Baota Petrochemical got the lowest allocation at 650,000 mt in total, accounting 30% of its ceiling.

 

Fuhaichuang, Hengli Petrochemical, Yatong Petrochemical, Zibo Xintai, Qingyishan Petrochemical and Lianhe Petrochemical did not fall short of their full allocations.

 

The other 20 million mt/year greenfield Hengli Petrochemical (Dalian) did not apply for quotas in the third round, an indication that its 16.8 million mt quotas would be enough to meet its throughput plan.

 

“We have no plan to apply for new quotas as it’s too risky to bring in more crudes at this moment, just to fully utilize the quotas,” said a source with Yatong Petrochemical.

 

In China, refineries built and operated by state-owned companies — Sinopec, PetroChina, CNOOC and Sinochem — do not need quotas to import crude oil.

 

However, all the other refineries, including independent ones and those owned and operated by state-owned companies like ChemChina and Norinco, require quotas to crack imported crude oil.

 

Source:Platts

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