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Ethylene production volume reaches relatively good levels, Sinopec

01 Sep '10

5 min read

The Group produced 493,900 tons of ethylene and 270,300 tons of propylene, representing an increase of 12.43% and 14.19% year-on-year respectively. The Group also produced 568,600 tons of synthetic resins and plastics, an increase of 5.20% year-on-year; 499,400 tons of synthetic fibre monomers, 329,800 tons of synthetic fibre polymers and 123,900 tons of synthetic fibres, representing increases of 16.74%, 14.04% and 2.82% year-on-year respectively. The Group's products maintained good and stable quality and the Group's output-to-sales ratio and receivable recovery ratio in the first half of the year were 100.05% and 99.55% respectively.

In the first half of 2010, as a result of a number of factors such as the global economic recovery, the European debt crisis and frequent natural disasters, international crude oil prices were moving at high prices ranges, adding to the cost of the Group's oil refinery business.

During the Period, the Group's total cost of crude oil processed amounted to RMB19,169.3 million, accounting for 60.25% of the Group's cost of sales. The average unit cost of crude oil processed was RMB3,932.37/ton, representing a significant increase of 54.59% as compared to the corresponding period of the previous year.

During the Period, the Group continued to adjust its business structure and product portfolio and focused on the earlier stage work of the Phase 6 Project with refinery revamping and expansion item as the main project. Starting from 15 March, 2010, the Group formally introduced the supply of natural gas from Shanghai network to accomplish the target of switching to 100% natural gas as substitute feedstock for No. 1 Hydrogen Making Plant, thereby achieving improved economic efficiency.

Meanwhile, other key technological renovation projects of the Group have also proceeded in an orderly manner in the first half of the year. The Group was carrying out environmental appraisals for the refinery revamping and expansion project and the carbon fibre project, and strived to start the construction of these projects within the year.

Looking ahead, Mr. Rong Guangdao said, "In the second half of 2010, the recovery of the world economy remains uncertain and unstable. Although China's economy may be facing a better development environment than last year, but the economic operation growth may slow down due to the interaction of a mixture of domestic and international factors. Combined with persistently high crude oil prices, the domestic petrochemical industry may tend to soar high in the first half of the year and fall in the second half of the year.

“In addition, as a result of the operation of too many newly-built capacities of certain petrochemicals and dumping impact of imported petrochemical products, market competition will become more intense in the second half of the year. Faced with the severe production and operation situations as before, the Group will continue tofocus on plant operation, make efforts for higher output volume, optimize production and operation, accelerate the construction of the projects in the next round development plan in a diligent and solid manner, further intensify internal management and strengthen its human resources structure and competence, with a view to further improving the Group's operation efficiency and development potential."

Sinopec Shanghai Petrochemical Company Limited

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