Saudi Aramco says that the China National Offshore Oil Corporation (CNOOC) has received its first cargo of Arabian crude oil at its newly expanded Huizhou refinery in South China.
Recently, the flagship Huizhou refinery of CNOOC located in the Guangdong Province was expanded from an original capacity of 240,000barrel per day (bpd) to 440,000bpd.
The expanded Huizhou oil refinery, which is a 50-50 joint venture owned by CNOOC and Shell, had been configured for the processing of sour Arab Gulf grades.
The Arab Medium crude oil from Saudi Aramco is a preferred choice for the refinery’s baseload.
According to the Saudi Arabian state-owned oil company, CNOOC is the third large Chinese national oil company to have joined its customer family.
A memorandum of understanding (MoU) inked by CNOOC and Saudi Aramco last year for future supply of crude oil and cooperation on downstream activities paved the way for the delivery of the first cargo of Arabian crude oil.
The MoU was a result of intergovernmental efforts to extend energy cooperation and create closer synergies between the China’s “Belt and Road” initiative and Saudi Vision 2030.
Aramco Asia president and CEO Nabil A. Al-Nuaim said: “The new crude sales agreement with CNOOC highlights that China is at the front and center of our downstream strategy and that we continue to be China’s most reliable supplier.
“Aramco Asia will continue to support Chinese and other Asian refiners to have access to reliable Saudi crude.”
The Huizhou refinery before its expansion was primarily processing domestic oil procured from its own offshore fields and as a result did not feel the necessity to import sour crudes, stated Saudi Aramco.
For the Arabian oil company, the expansion of its market share in China is a major strategic target. New crude sales agreements like the Huizhou supply it says will make a crucial contribution for its business.
Image: CNOOC’s first Arabian crude oil cargo arrives at the Huizhou refinery. Photo: courtesy of Saudi Arabian Oil Co.