2023 marked the 40th anniversary of Sinopec Group, a glorious milestone for China’s and even the global petrochemical industry. The past four decades have witnessed extraordinary and magnificent development of China’s petrochemical sector. This article focuses on the evolution of foreign petrochemical enterprises participating in China’s polyolefin industry, reviewing the critical cooperation history, localization transformation and China’s outbound global layout.
Founded in 1990 and officially put into operation in 1997, Dalian West Pacific Petrochemical Co., Ltd. is China’s first large-scale Sino-foreign petrochemical joint venture approved by the State Council. It is co-invested by PetroChina and TOTALEnergies (TOTAL).
As a modern refining and chemical enterprise centered on a 5 million-ton annual oil refining unit, the plant produces diversified oil products and chemical materials. Its only polymer unit is polypropylene (PP), with an initial annual capacity of 60,000 tons, later expanded to 120,000 tons. The brand-grade PP T30S produced by Dalian West Pacific has long been a well-recognized classic product in China’s polyolefin market.
Established in 1995 and commissioned in 1998, Shanghai Jinfei Petrochemical Co., Ltd. is China’s first joint venture specialized in polyethylene (PE) production, jointly funded by Sinopec and Chevron Phillips Chemical (CPChem). Adopting advanced loop slurry polymerization technology, the company manufactures high-density polyethylene (HDPE) with multiple classic and time-tested premium grades, including TR144 and 5502, which have maintained stable market influence for decades.
Over the past 30 years of booming development of China’s petrochemical industry, a large number of world-leading petrochemical enterprises have entered the Chinese market, including Chevron Phillips Chemical (CPChem), BP, BASF, Shell, ExxonMobil, Saudi Aramco, SABIC, SK HOLDINGS, LyondellBasell, KNPC, PDVSA and Ineos.
Among all foreign investors, SABIC and Saudi Aramco form the largest overseas deployment in China’s petrochemical industry, owning two existing northern and southern production bases with two additional new bases under planning, maintaining the most extensive cooperative layout in China. ExxonMobil and BASF are the only two foreign enterprises operating wholly-owned petrochemical facilities in China.
The entry of BP through the joint venture Shanghai SECCO Petrochemical Company marks the large-scale formal entry of foreign petrochemical capital into China. At the time of its launch, SECCO’s new PE capacity accounted for 17% of China’s total domestic polyethylene capacity, an unprecedented market share that has never been surpassed. Over the past two decades, Shanghai SECCO has supported the rapid growth of China’s petrochemical industry with its customer-centric differentiated marketing philosophy.
Notably, the three earliest benchmark joint ventures have completed state-owned acquisition and restructuring. Shanghai SECCO established a new joint venture with Ineos in 2022. Another influential landmark project is Fujian Refining & Petrochemical Joint Venture, co-constructed by Sinopec, ExxonMobil and Saudi Aramco. It occupied 11% of China’s new PE capacity upon commissioning and remains the only petrochemical joint venture jointly invested by two international oil giants.
While actively introducing foreign capital, technology and experience, China’s polyolefin industry has always adhered to independent development. From 2010 to 2013, driven by projects including Fujian Refining and Wuhan SK joint venture, the market capacity share of foreign joint ventures in China’s PE industry peaked at 27% to 32%. After the state-owned restructuring of SECCO and Jinfei in 2017, the proportion dropped to approximately 18%.
At present, China has maintained stable independent control over core polyolefin production capacity, with foreign joint venture capacity stably accounting for 20%–21% of domestic PE capacity and 11%–13% of PP capacity. Although polyolefin is not a primary energy product, it is a critical livelihood-related raw material refined from energy resources, covering all aspects of social production and people’s lives.
As China’s largest and the world’s second-largest chemical manufacturer, Sinopec holds one-third of China’s polyethylene production capacity and one-quarter of the domestic polypropylene capacity. It plays a vital role in ensuring stable supply of bulk chemical raw materials, stabilizing basic commodity prices and improving people’s living standards.
China’s polyolefin and petrochemical industry never stops at introducing foreign investment. While embracing global resources and technologies, Chinese petrochemical enterprises have actively expanded overseas markets and realized two-way global integration.
Sinopec holds a 62.5% equity stake in the Saudi Yanbu petrochemical project, while Saudi Aramco holds the remaining 37.5%. The project represents Sinopec’s key strategic layout in the Middle East energy market.
In the Russian Sibur petrochemical project, Sinopec holds a 40% stake, and Gazprom holds 60%. It is an important cooperative achievement between China and Russia in the field of modern petrochemical and new energy industries.
