Yussen Chemical is expected to start commercial production at its new 450,000 mt/year Huizhou MTBE plant in southern China's Guangdong province by August 20, after having started trial runs at the plant this week, traders with knowledge of the matter said Thursday.
MTBE output from the plant would be mainly marketed to nearby CNOOC's 240,000 b/d Huizhou refinery -- which is also completing an expansion to 440,000 b/d in August -- for gasoline blending, with some volumes likely sold to south China-based independent gasoline blenders, according to market sources.
Yussen Chemical was unavailable for comments.
The company has another 80,000 mt/year MTBE plant and 200,000 mt/year sec-butyl acetate plant at the same site.
The start-up of Yussen Chemical's new MTBE plant will raise China's total MTBE production capacity to an estimated 8 million mt/year by end of this year, S&P Global Platts reported previously.
New capacity coming on stream this year includes an 800,000 mt/year propylene oxide/MTBE joint venture between Huntsman and Sinopec Jinling, that started commercial production in end-June.
Meanwhile, domestic MTBE prices in eastern China had risen by around Yuan 100-200/mt since the start of this week to be heard at Yuan 5,100-5,200/mt Thursday. The rise was attributed to a steady drawdown of gasoline stocks at state-owned refiners Sinopec and PetroChina, on reduced operating rates at independent refiners in eastern China's Shandong province since mid-July, according to industry sources.
Adding to this, major east China-based MTBE producer Wanhua Petrochemical had been running its 800,000 mt/year propylene oxide and MTBE plant at Yantai at 60% capacity since July 12 because of the replacement of a main component used in MTBE production at the plant. Yantai Wanhua now aims to ramp up runs to full capacity by the end of this week.
In southern China, domestic MTBE prices were heard at Yuan 5,200-5,300/mt Thursday.
