A Change of Guard

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Saturday, 29 December 2012

China backs Cambodia's first oil refinery [Cambodia to build first oil refinery ]

File picture of an oil refinery. (AFP - Robert Sullivan)
Cambodian Deputy Prime Minister Sok Ann speaks to the media in Phnom Penh on February 3, 2012 (AFP/File, Hoang Dinh Nam)
Channel News Asia
 Posted: 28 December 2012

PHNOM PENH: Cambodia on Friday gave the green light to construction of its first oil refinery, a multi-billion-dollar Chinese-backed project, as the kingdom looks to tap its untouched offshore reserves.

Cambodia's oil and gas regulator approved a deal to allow SINOMACH China Perfect Machinery Industry Corp. and Cambodian Petrochemical Co. jointly invest $2.3 billion in the plant in the southwest of the country.

"We hope that we will have an oil refinery plant that can produce five million tonnes of oil products a year," Deputy Prime Minister Sok An said during the signing ceremony.

The plant is expected to start operating in late 2015.

Cambodia had hoped to begin pumping oil this month from offshore fields, but the start has been delayed indefinitely, according to government officials.

The country was feted as Southeast Asia's next petro-state after oil was discovered there in 2005, but production stalled amid apparent wrangling between the government and US energy giant Chevron over revenue sharing.

"We have been trying our best to develop the oil sector for years but without results," Sok An said, adding that the government was still in talks with Chevron.

Cambodia could be sitting on hundreds of millions of barrels of crude and natural gas, according to some estimates, but it remains unclear how much can actually be recovered.

Chinese, Cambodian firms to jointly build first oil refinery in Cambodia


Sinomach China Perfect Machinery will carry out construction of the refinery. Construction is expected to complete by end-2015, Xinhua said, without mentioning a start date. Upon completion, the plant will have the capacity to refine 5 million tpy of oil products, equivalent to about 100,000 bpd,

BEIJING -- Cambodian Petrochemical Company and Sinomach China Perfect Machinery Industry Corp. will jointly develop Cambodia's first oil refinery costing an estimated $2.3 billion, Xinhua News Agency reported Friday.
The oil refinery will be located on an 80-hectare area within a boundary of Preah Sihanouk province and Kampot province, Xinhua reported, citing Zhang Sugang, president of Sinomach China Perfect Machinery Industry Corp.
Sinomach China Perfect Machinery, a state-owned firm with diverse businesses ranging from oil engineering to property, will carry out construction of the refinery, Xinhua said.
Construction is expected to complete by end-2015, Xinhua said, without mentioning a start date.
Upon completion, the plant will have the capacity to refine 5 million tpy of oil products, equivalent to about 100,000 bpd, Mr. Zhang said.
Cambodia's oil demand is forecast to rise to 3 million-4 million tpy eventually, up from 1 million currently, in tandem with rising economic growth. That's according to Sok An, the chairman of Cambodian National Petroleum Authority. He is also the country's deputy prime minister.

Dow Jones Newswires


Anonymous said...

I believe Chevron won't be able to open a refinery oil factory because no matter what this corruption government won't cooperate with internationals to make the oil revenue more transparently. If it is more transparent, the the elites cannot corrupt. Only the China company that builds agree with this government because they are willing to corrupt with this government.

Anonymous said...

The question I need to ask is: who owned Cambodian Petrochemical Co, Ltd? Is it Sok An? This company has just come from nowhere and made a major joint venture with this Chinese company. If it is owned by Sok An then it is purely corruption- stealing Cambodia's oil to making himself rich.