PetroChina Starts Operating Fuel-Making Units at Dalian Plant

By Winnie Zhu

Aug. 8 (Bloomberg) -- PetroChina Co. started operating fuel-producing units at a northern refinery, making it the nation's largest and boosting supplies in time for the start of the Beijing Olympics.

Capacity at the plant in the northern Chinese city of Dalian had almost doubled to 20.5 million metric tons a year, or 410,000 barrels a day, by yesterday as the last of seven processing units came on stream, parent China National Petroleum Corp. said in a statement on its Web site. The Games start today.

The total capacity includes the ability to process 16 million tons of high-sulfur, or so-called sour, crude on an annual basis. The plant will refine 10,000 tons of Kuwaiti oil a day starting this month, the Beijing-based parent of China's largest oil producer said today.

The Dalian refinery in Liaoning province received its first cargo of 270,000 metric tons of Kuwaiti crude on July 23, Zhu Aihua, a spokesman at the plant, said last month.

The plant will source a third of the crude it processes from Daqing, the nation's largest oilfield, and the rest will come from countries including Kuwait, Saudi Arabia and Sudan, Zhu said July 28.

Most crude supplies from the Middle East are classified as high-sulfur grades, with sulfur content exceeding 1 percent. It is harder to process high-sulfur crude, which needs further refining to make cleaner-burning gasoline and diesel.

To contact the reporter on this story: Winnie Zhu in Shanghai at wzhu4@bloomberg.net