BP makes big moves in China
12 May 2004
BP has signed a number of agreements covering investments totalling around $1 billion which will deepen its presence in the growing Chinese energy market.
Building on its existing BP and Sinopec acetic acid joint venture in Chongqing, BP now plans to build a 500,000 tonnes a year acetic acid plant in Nanjing, Jiangsu province, through a 50/50 joint venture with Sinopec. The plant, which will incorporate BP's Cativa technology, is expected to come on stream by the end of 2006 and supply acetic acid for use in such products as fibres, paint, adhesives, pharmaceuticals and printing inks in eastern China.
The company also signed a letter of intent to examine the viability of expanding production at the BP Zhuhai PTA plant from 350,000 tonnes a year to 1.2 million tonnes a year. The plant, which is located at Zhuhai in the Pearl River Delta, is a joint venture between BP (85%) and the Fu Hua Group (15%) and came on stream in September 2003.
In the Chinese retail service station arena, two joint ventures - BP Sinopec Zhejiang Petroleum and the BP PetroChina Petroleum - will each acquire, build and operate 500 retail service stations in the Zhejiang and Guangdong provinces respectively by 2007. BP has an initial 40% stake in the BP Sinopec Zhejiang Petroleum Company and a 49% holding in the BP PetroChina Petroleum Company.
In a separate move, BP also announced that it has agreed to be a partner in a hydrogen vehicle demonstration project being established by the Chinese Ministry of Science and Technology. BP will design, construct, operate and supply hydrogen refuelling facilities for the project which will see hydrogen powered vehicles operating in Beijing and Shanghai.
The Ministry of Science and Technology, which is developing and co-funding the project together with the United Nations Development Programme and the National hydrogen programme, is still in the process of finalising details with other potential project partners but it is envisaged that it will become operational in mid 2005.
