ExxonMobil starts US$10 billion Guangdong petrochemical project
China aims to upgrade industry with first wholly US-owned facility
29 Apr 2020 | Michael Marray

ExxonMobil has broken ground on its US$10 billion petrochemical project in Huizhou, Guangdong province.

On April 22, a ceremony to mark the start of construction was held via video link, connecting participants in offices in the Huizhou Dayawan Petrochemical Industrial Park, the Great Hall of the People in Beijing, and ExxonMobil headquarters in Texas.

In a sign of the importance the Chinese government attaches to the project, Chinese Vice Premier Han Zheng attended the online ceremony.

The ExxonMobil Huizhou Project is the first major petrochemical project built in China by a wholly US-owned company.

The project involves the construction of a 1.6 million tonne-per-year ethylene cracker, which will start operations in 2023, and a liquified natural gas terminal.   

The project is seen by officials as a chance to upgrade China’s petrochemical industry and promote the competitiveness of the Guangdong-Hong Kong-Macao Greater Bay Area. 

ExxonMobil already operates a petrochemical complex in Fujian province in a joint venture with Saudi Aramco and Sinopec, but the Guangdong facility is one of the new generation of projects to be wholly owned by US, Saudi and German companies.

In 2018, Saudi Basic Industries (SABIC) signed a memorandum of understanding to build a wholly owned petrochemical project in Fujian province. SABIC already has, as part of a joint venture with Sinopec, a petrochemical complex in the northern Chinese city of Tianjin.

Also, in 2018, BASF disclosed plans to invest US$10 billion in a chemical complex in Guangdong featuring a one million-metric-tonne ethylene cracker.

In January 2019, Martin Brudermüller, BASF's chairman of the board of executive directors, and Lin Shaochun, Vice Governor of Guangdong, signed a framework agreement in Ludwigshafen, Germany, setting out further details of BASF’s plan for a Verbund site (a vast, interconnected production complex) in the city of Zhanjiang.

“By 2030, China’s share of the global chemical production will increase to nearly 50%," Brudermüller said at the time. "Guangdong is a growing market for innovations from chemistry, and our new site will support customers in multiple industries."

Guangdong authorities see petrochemicals as a driving force for numerous downstream industries, with BASF’s new integrated site contributing to the industrial transformation of the province.

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