SINOPEC Jinling Co, a unit of China's largest oil refiner, will expand its crude refining capacity by 33 percent by 2010 as demand for fuel rises in the world's fastest-growing major economy.
The refinery at Nanjing in eastern Jiangsu Province will be able to process 18 million metric tons of crude oil by 2010, from 13.5 million tons now, Zhang Dafu, chairman of Sinopec Jinling, said in Beijing yesterday.
China plans to increase oil-refining capacity by 25 percent by 2010.
The economy expanded 11.4 percent last year, boosting demand for fuel and chemicals from PetroChina Co and China Petroleum & Chemical Corp, also Asia's largest refiner.
Sinopec Jinling plans to boost its oil-processing volume by about six percent this year. Zhang said: "More than 80 percent of our crude is imported, and most of the overseas purchases are heavy oil from Saudi Arabia."
The refinery plans to shut about one-third of its capacity in April and May for maintenance, which will last 30 to 45 days, Zhang said.
Sinopec Jinling may lose 1.5 billion yuan (US$211 million) in the first quarter, compared with a profit of 80 million yuan last year, he said, according to Bloomberg News.
Sinopec Jinling may have a profit margin of five percent in fuel sales if crude oil prices are US$65 a barrel, way below present levels, Zhang said.