BIZCHINA / Chemical
Foreign Investment
Updated: 2006-04-21 14:18
Introduction to Foreign Investment in Petrochemical Industry
In accordance with the Guiding List Concerning Foreign-Funded Industries
jointly published by the State Development Planning Commission, the State
Trade and Economic Commission and former Ministry of Foreign Trade and
Economic Co-operation (MOFTEC), foreign investors are encouraged to
invest in the following fields of the petrochemical industry: further
processing of the needle-shaped coke and coal tar, the production of
tamped coke and pitch for important roads. Foreign investment is
restricted in the construction and management of factories for oil
refinement.
Along with the development of reform and opening up to the outside world,
petrochemical enterprises are speeding up their use of foreign capital
and the property structure is moving towards diversification.
The China National Petroleum Corporation (CNPC), China Petroleum and
Chemical Corporation (SINOPEC) and China National Offshore Oil
Corporation (CNOOC) have succeeded in listing in overseas stock markets
through their affiliates -- China Petroleum and Gas Ltd, China Petroleum
and Chemical Ltd and China Offshore Oil Ltd. State-owned petrochemical
enterprises began transforming into commercialized corporations with
different kinds of proprietors.
In April and October 2000, the stocks of China Petroleum and Gas Ltd and
China Petroleum and Chemical Ltd listed in the overseas stock market in
succession. Shell, ExxonMobil and BP are the biggest strategic investors
in the Chinese petroleum industry and the their capital contributions led
to the success of stock listings abroad. On February 27-28, 2001, the
stocks of China Offshore Petroleum Ltd are listing in the New York and
Hong Kong stock markets, raising capital worth US$2.71 billion. Thus,
China's three main petrochemical enterprises have realized their
objectives of listing abroad.
In addition, transnational corporations around the world have already
begun their investment in the Chinese market. BP, as one of the biggest
petroleum and chemical corporations in the world and a leading investor
in the Chinese petrochemical market, has invested more than US$3.5
billion in China and worked with CNPC, CNOOC and SINOPEC in upstream and
downstream businesses.
Shell has injected US$1 billion into China as well, having established
more than 20 joint ventures (JV) and offices and 40 JV joint-stock gas
stations, 10 of which are stationed in Tianjin. And with about 20 percent
of SINOPEC shareholdings, ExxonMobil owns 36 gas stations in China. To
date, gas stations with a foreign-capital background number more than 400.
The approved petrochemical projects of foreign investments in 2000
totaled 36, down 26.53 percent from 49 in 1999; the contractual value
totaled US$1.32471 billion, up 854.13 percent from US$138.84 million in
1999. The approved petrochemical projects in 2001 totaled 45 in 2001, up
25 percent over the previous year; the contractual value totaled
US$164.38 million, down 88.6 percent over the previous year. The approved
petrochemical projects in 2002 totaled 62, up 37.78 percent over the
previous year; the contractual value totaled US$171.96 million, up 4.61
percent over the previous year.
(For more biz stories, please visit Industry Updates)
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