China National Petroleum Corporation has received its first deepwater equity output, Mero crude, from the Mero Field in offshore Brazil at Dalian port, the company said in a statement Thursday.
The 44,000 mt Mero crude, which arrived on Tuesday, will be shipped to be refined at PetroChina's Jinzhou Petrochemical and Jinxi Petrochemical in the same province.
This cargo would most likely be cracked at these two refineries as an experiment, a refinery source with PetroChina said.
Jinzhou Petrochemical and Jinxi Petrochemical, usually process crudes with low sulfur content, like the domestic Daqing crude.
The latest shipment of the new Mero crude would add to the growing basket of Brazilian medium and heavy sweet grades sold to China in recent years.
Over the past few years, Petrobras has been actively selling spot cargoes of various Brazilian export grades including Marlim, Lula, Iracema, Sapinhoa and Roncador to Chinese end-users.
At the same time, western trader Vitol was also taking delivery of its 40,000 mt cargo of Mero crude, which was being discharged by the VLCC Gener8 Apollo at Dongjiakou of Qingdao port in eastern Shandong province, market sources said.
Vitol will store the cargo in bonded tankers first, since the trader has not yet secured buyers for this parcel, they added.
This was also the first time the Mero crude grade had been delivered to Shandong and will most likely end-up in the hands of independent refineries in the province.
Mero, previously known as Libra, had its name changed when the field was declared commercially viable for development.
Mero is estimated to hold about 3.3 billion barrels of recoverable crude rated 29 API, with a sulfur content of 0.306.
Brazil's state-led Petrobras has a 40% operating stake in the Mero field, while Total and Shell each hold a 20% stake. Chinese companies CNOOC and CNPC each own a 10% stake.
Each of the shareholders will take turns to take crudes from the project, with CNPC taking the first cargo in March.
Over the first three months of 2018, China has imported about 8.08 million mt of crude oil from Brazil, up 39.8% year on year.
Sources:Platts
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