74 White Paper on Guangzhou Foreign Trade and Economy 2008

Petrochemical Industry
Brief Introduction
As one of the pillar industries of Guangzhou, the city's petrochemical sector had a gross
industrial output value of 140.807 billion yuan in 2007 with a year-on-year increase of
26.7%, accounting for 14.27% of the city's aggregate value and contributing to 18% of the
increase therein. With the reform and upgrade of Guangzhou Petrochemical Complex (GPC),
Guangzhou will have the capability to refne 13 million tons of petroleum and manufacture
800,000 tons of ethylene. As the future cooperation project between Sinopec and the Kuwaiti
National Petroleum Company is in progress. The above-mentioned two fgures will further
rise to 28 million tones and 1.8 million tons respectively.
Thanks to the driving effects of GPC and other leading enterprises, the petrochemical sector
in Guangzhou is now a competitive industry system with complete and diversifed products,
including petroleum, benzene, diesel, coke, synthetic detergents, etc. In the meantime, with
the leading role of major enterprises in refinery and ethylene, there have been constantly
new developments in the sectors of petroleum processing, deep processing of petroleum
chemicals, fne chemistry and new petroleum chemical materials.
The development of Guangzhou' s petrochemical industry has the following two
characteristics:
I. Obvious Advantages in Industrial Development
In terms of market factors, Guangzhou has the largest market of petroleum chemicals in the
nation, with the consumptions of ethylene, the fve major kinds of general-purpose resins,
the five major kinds of engineering plastics and paints accounting for over 20% of the
national totals, playing a very important role across the nation as far as market capacity and
Key Industries Petrochemical Industry 75
scale are concerned.
As for the industrial chain, several multinational chemical giants such as Exxon, Basf
and Dow Chemical have settled in Guangzhou. Preliminary work has been carried out for
integrated refnery project of 15 million tons under the cooperation between Sinopec and the
Kuwaiti National Petroleum Company as well as for the renovation & expansion ethylene
project with an annual capacity of 800,000 tons in the name of GPC. The petrochemical
industrial chain in Guangzhou will be expanded with greater scale and competitiveness from
refnery to ethylene cracking and further to fne chemical products downstream.
In terms of human resources, Guangzhou boasts a great number of high-level professionals
in the petrochemical industry. And there are also such top-grade research institutes and
universities as School of Chemistry and Chemical Engineering of Sun Yat-sen University,
School of Chemical Engineering and Energy and School of Chemical Science of South
China University of Technology, School of Chemistry and Environment of South China
Normal University, School of Light Industry & Chemical Engineering of Guangdong
University of Technology and School of Chemistry and Chemical Engineering of Guangzhou
University.
II. Signifcant Industrial Cluster
With the scientific planning and construction efforts, the layout of Guangzhou' s
petrochemical industry is gradually rationalized. Currently several major clusters of the
petrochemical industry have been formed including Huangpu Petro-chemistry Base and the
GETDD Fine Chemistry Base in the east as well as the Nansha Near-Port Petro-chemistry
Industrial Base in the south.
The eastern petrochemical base mainly covers the following: the GPC Industrial Park,
Huangpu Industrial Park, Huangpu Jitang Fine Chemistry Industrial Base as well as Eastern
Zone and Yonghe Zone of GETDD. With the expansion of GPC's refinery and ethylene
project, we have extended the chemical industrial chain, with the focus on integrated
petrochemical development. Besides, the alternative and auxiliary industries as well as
products of fnishing & deep processing have been developed in order to form an industrial
chain of "petroleum chemical engineering--fne chemistry industry--deluxe plastics--terminal
products".
Guangzhou Development District focuses its development on fine chemical industry and
has set up functional zones for washing and personal nursing products. Priority will also be
given to the fine chemistry industry or some important products therein, with reasonable
76 White Paper on Guangzhou Foreign Trade and Economy 2008
arrangements to optimize the industrial layout and structure of fne chemistry.
Nansha Port-related Petro-chemistry Industrial Base will be mainly based in Wanqingsha
to attract investments from world famous multinational petrochemical enterprises with its
expansive land areas, geographical advantages as the estuary of Pearl River and the sea as
well as the excellent coastline resources.
According to the principle of mutual connection and support of industrial chains within the
zone, oil refning and petroleum chemistry will take the leading role as the major players
of petroleum chemical deep processing, fine chemistry and new materials, so as to re-
construct the overall advantages and industrial framework of the petrochemical industry.
The zone covers an area of about 30 square kilometers under planning with focus on such
petrochemical clusters as Xiaohu Petrochemical Industrial Park, Huangge Industrial Park,
Wanqingsha Petrochemical Industrial Zone, etc.
Development Priorities
Guangzhou will further facilitate the development of the petrochemical industry. To be more
specific, advanced manufacturing technologies will be adopted to enhance the scale and
quality of leading petrochemical sectors such as oil refning and ethylene. Based above, the
basic petrochemical materials will be increased to strengthen the deep processing industry of
petrochemical materials, so as to build a complete and modern industrial chain and form a
modern petrochemical industrial system of strong connections with such superior sectors as
automobiles, electronics, household appliances, textile and other light industries. Measures
will be taken to accelerate the construction of the Huangpu Petro-chemistry Base and the
Fine Chemistry Base at Guangzhou Development District in the east as well as the Nansha
Petro-chemistry Industrial Base in the south. The aim is to build it into a base of world level
for modern integrated oiling & petrochemicals as well as downstream deep processing to
make it the major platform for the future structural adjustment and upgrade of Guangzhou's
petrochemical manufacturing industry Focus will be on the the following industries:
I. Petroleum Refning and Ethylene
In line with the development principles of "local development, accelerated progress and
attention to an environmental protection", the advantages of integrated petro-chemistry will
be optimized, so as to greatly upgrade elevator raise the comprehensive processing capability
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of petroleum refning and construct a refning base of tens of million tons and a mega tonic
ethylene base.
II. Polyethylene and Polypropylene
Efforts will be paid to construct large polyolefn apparatus integrating both upstream and
downstream in addition to the mega tonic production bases for polyethylene, polypropylene,
polystyrene and other resins. New technologies will be applied, i.e. catalysts, polymerization
and application as well as clean production process, so as to sharpen the competitiveness
edge of polyethylene and polypropylene products. We encourage the development of such
cutting-edge technologies petrochemical products with economic scale but shortage in
supply in the market, for instance, ABS, acrylic acids, related esters, etc.
III. Polyvinyl Chloride (PVC)
Efforts will be placed to bring into play the respective initiatives and advantages of central
government-controlled enterprises and local businesses and actively introduce technologies
and investments. The initiative is to balance ethylene resources, to construct PVC apparatus
with the capacity of 300,000 tons/year and build the supporting devices of ion membrane
chlorine alkali with the capacity of 200,000 tons per year.
IV. Paints
i. Car paints: We will actively carry out investment promotion and joint venture
cooperation to develop paints for deluxe sedans. A 10,000-ton car paint production base as
per high standards is scheduled to be built. .
ii. Weather-proof latex paints for construction: Great endeavors have been made to
develop construction paints with weatherproof capacity of over 10 years as well as excellent
stain resistance, such as silicone acrylic emulsion, fuorocarbon emulsion and other kinds of
quality binder emulsion.
iii. Functional paints: We will make use of the abundant rare-earth resources in
Guangdong to develop rare-earth luminous paints, in addition to heatproof and fre-proof
paints.