Expectations of soaring growth in China's crude oil imports has officials taking another look at the country's coastal crude oil tanker terminals.
At first glance, plans to add China's coastal tanker terminal capacity would seem to slightly exceed projected needs. However, officials say, existing major terminals are already woefully underutilized. That overcapacity wall only worsen as plans proceed to construct a number of major new terminals to accommodate the expected surge in calls by large oceangoing tankers as exports increase.
CHINA'S CRUDE TANKER TERMINALS
China has 10 crude tanker terminals along its eastern coast, each of which can handle at least 90,000 b/d (Table 1).
Another four terminals are under construction or waiting approval for expansion plans.
Officials estimate that the volume of imported crude to be transferred from terminals in Shangai and Zhejiang province to refineries along the Yangtze River will average 180,000 b/d in 1995, 380,000 b/d in 2000, and more than 600,000 b/d in 2010.
The terminals at Zhenhai and Aoshan in Zhejiang province alone could handle that kind of volume, with their combined capacity of 640,000 720,000 b/d. About 890,000 b/d of crude is processed in this region at: Gaoqiao and Shanghai refineries at Shanghai, Zhenhai refinery in Zhejiang province, Yangtse refinery and Jinling refineries in Jiangsu province, Jingmen and Wuhan refineries in Hubei province, Jiujiang refinery in Jiangxi province, and Anqing refinery in Anhui province.
China imports crude from the Middle East, West Africa, and Southeast Asia.
The tanker terminals used to transport China's crude exports are in Qinhuangdao in Hebei province and Qingdao in Shandong province. Most of the crude that is exported is produced in Daqing and Shengli oil producing areas in Hebei and Qingdao provinces, respectively.
China's crude exports mainly go to Japan, the U.S., South Korea, the Philippines, Singapore, and Brazil.
EXPANSION PLANS
By 1997, China's southern coast will have two new crude tanker terminals that can handle tankers of 250,000 dwt and 100,000 dwt, respectively, both in Guangdong province.
At that time, combined capacity of South China tanker terminals currently in the planning stages is expected to match that of the East Coast at 800,000 b/d.
Refineries in the region, however, are expected to have crude runs totaling only 400,000 b/d.
The design capacities of China's tanker terminals far outstrip the volumes of crude actually handled. Volumes offloaded at the 200,000 b/d Xiaocuo terminal which is capable of handling 100,000 dwt tankers built for the Fujian refinery run only about 50,000 b/d. At the Aoshan terminal, capable of handling 200,000 dwt vessels, handles about 60,000 b/d compared with a design capacity of 400,000 b/d.
PROBLEMS
The underutilization of China's crude tanker terminals stems from poor planning, Chinese transportation officials contend.
In recent years, most crude tanker terminals have been built by refining/petrochemical complex administrations under China National Petrochemical Corp. (Sinopec) rather than by the nation's Transport Ministry.
These entities have sought to eliminate transfer fees by constructing their own tanker terminals rather than lease capacity at an existing third party terminal, which would involve added transportation costs by further shipping of crude via smaller shuttle tankers from the main coastal terminals to their processing facilities. At the same time, these extra terminals are linked to storage facilities and an interior rail/highway infrastructure that is inadequate to handle the volumes of crude the terminals are designed for. The cost of expanding the storage/transportation infrastructure becomes prohibitive after laying out as much as 300 500 million yuan ($52 87 million) for the average cost of a terminal.
OUTLOOK
With the outlook for China becoming a net crude importer by 1995 or possibly as early as this year, construction of the big crude tanker terminals to accommodate 100,000 250,000 dwt oceangoing tankers becomes a priority.
The bigger terminals carry with them a better economy of scale, featuring sharply lower transportation fees (Table 2).
The Middle East, which will continue to be China's major source of crude imports, is almost 6,000 nautical miles from China. So it becomes apparent that large tankers of 150,000 200,000 dwt will be the cost efficent way to transport China's burgeoning crude imports.
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