China’s booming petrochemicals industry saw its overall profits rise by 30% in 2017, the highest in six years, state media reports said.
Profits in the sector totalled around US$130 billion, driven by mushrooming revenues and exports, the China Petroleum and Chemical Industry Federation told the official Xinhua news agency.
Industry revenue increased 12.5% year on year to 14.5 trillion yuan (US$2.27 trillion), while the value of exports and imports combined grew 22% to US$560 billion, China Daily reported.
The growth surge came after the industry apparently complied with an edict from the government in 2016 to improve competitiveness.
“The petrochemical industry has been hindered by overcapacity along with security and environmental constraints,” Xinhua said.
Industry efficiencies are still in progress. The National Development and Reform Commission (NDRC) has called for energy consumption per yuan of output to be reduced by 8% by 2020 from 2015 levels, carbon dioxide (CO2) emissions to be cut by 10% and water consumption to fall by 14% from 2015 levels.
The industry federation comprises scores of regional associations of enterprises as well as national oil companies (NOCs). “[It] is committed to uniting the whole industry and achieving sustainable development [and] is now developing healthily and rapidly while paying close attention to enhancing capacity building and business expansion,” chairman Li Yongwu said in a statement.
The industry is in the process of relocating hundreds of chemical production plants classified as toxic which operate in densely populated urban areas. As part of environmental improvements, a directive from the central government in September 2017 ordered a speeding up of the process.
“Small to mid-sized chemical plants that fall into the toxic category must have completed their relocation work by the end of 2020 and if they haven’t started removal work yet, this must begin next year ,” ICIS said. In eastern Shandong Province alone 185 plants have been identified for relocation.
The petrochemicals industry has been boosted by record volumes of imported crude oil which topped 9 million bpd in some months of 2017.