China is estimated to import 260-270-mil mt of crude in 2011, up 11-12% from the previous year, slower than the growth rate of 17.5% in 2010. The nation's reliance on imported crude might climb to about 56% this year.
The imports would be mainly driven by three factors: 1, further increases in crude throughput of refineries put into production in the second half of 2010, like PetroChina's 10-mil-mt/yr Qinzhou refinery; 2, rising crude supply from the 15-mil-mt/yr Sino-Russia Crude Pipeline; 3, official operations of a combined 6-mil-cu-m national strategic petroleum reserve storages in Northwest China's Dushanzi and Lanzhou in the second half of 2011.
The Sino-Russia Crude Pipeline is likely to run at full blast in 2011, ESPO Blend crude from which might replace 0.5-1-mil mt per month of supply by rail or barge, market sources gauged.
PetroChina's 16-mil-mt/yr Dushanzi Petrochemical may continue to run at low rates in the year because of poor transmission capacity of the Sino-Kazakh Crude Pipeline.
China may inject the northwestern strategic petroleum reserve storages step by step.
In addition, major refineries in China would record less maintenance in 2011, which will prop up crude imports. The refineries are anticipated to have 180,000bbl per day of refining capacities under maintenance on average this year, accounting for 2.2% of the total primary crude processing capacity, C1's research showed. The maintained capacity averaged 290,000 bbl per day in 2010, occupying 3.6% of the total at that time.
Chinese refineries would keep high operation rates on the whole if international crude prices were below US$95/bbl averagely in 2011.
Refining projects to come on stream in 2011 would not contribute much to the rise in crude imports in the year. C1's data indicated that the total capacity of new refining projects would be not more than 15-mil mt per year in 2011, taking up around 43% of that in 2010.
