CNOOC buys stake in Shandong Haihua

China National Offshore Oil Corporation (CNOOC) has strengthened its downstream presence by taking a 51% stake in Shandong Haihua Co., Ltd. CNOOC will invest seven billion yuan (US$1.02 billion) to increase the Haihua refinery’s capacity to 160,660 barrels per day (bpd) from 60,250 bpd, Haihua said, adding that CNOOC will pump crude oil from its nearby Bohai Bay refinery. The acquisition will allow CNOOC to penetrate the oil products market in Shandong, which has one of the most robust economies in the coastal region. Haihua is mainly into chemical products such as soda, ethylacetate, ethylene chloride and potassium sulfate, but the company also owns a one million metric ton per year (mtpy) or 20,000 barrel per day (bpd) oil refinery, which was the main attraction for CNOOC. The company is China’s major upstream offshore player, but is still aiming to have 30 million mtpy (600,000 bpd) of crude refining capacity by 2010, 40 million mtpy (800,000 bpd) by 2015 and 70 million mtpy (1.4 million bpd) by 2020. (September 9/18, 2008)