Sinopec plans to boost gasoline runs and gas and oil exports

China's Sinopec Corporation will boost its gasoline production to meet rising domestic consumption while stepping up efforts to export gas and oil to meet the country's changing product demand structure.
A report said that the country was seeing "a decline of gas and oil sales" and "a relative tightness in gasoline supply".

In January, China's oil product demand was 2.71 mm tons, or 16.6 %, less than the same period in 2008, the report said. This implied Chinese oil product demand reached 13.62 mm tons in January this year versus 16.34 mm tons a year earlier. During the comparison periods, gas and oil demand tumbled 30.2 % versus an 8.4 % increase in gasoline demand.
Other than being a common transportation fuel, gas and oil is also widely used in China's industrial, manufacturing, and commercial sectors. Gasoline consumption is on the rise in the country owing to a burgeoning middle class and increased vehicle ownership.

To meet China's changing fuel consumption needs, Sinopec recently listed various measures to boost gasoline production in an urgent notice issued to its refining business segment. It advised its refineries to work with the group's engineering and technology institutes to come up with ways of lifting gasoline output while limiting gas and oil production, to adjust gas and oil-to-gasoline yield ratio, and to coordinate crude feedstock purchase to meet the goal.
In February, the refiner lowered its gas and oil-to-gasoline yield ratio to less than 2.

According to the report, Sinopec will request its refineries to further refine their crude procurement selection and feedstock composition for ethylene production, to increase gasoline output and to step up gas and oil export. The company will also encourage its sales and distribution segment to adopt flexible marketing strategy in expanding domestic gas and oil sales in order to create a favourable condition for the group's refineries "to raise crude runs and increase gasoline output."
In February, the company told eight of its refineries in coastal China to prepare to export oil products in March. The eight refineries together account for about half of the group's total crude processing capacity of more than 180 mm tpy (3.82 mm bpd).

According to the Chinese customs data, the country exported 130,000 tons (31,242 bpd) of gas and oil in January 2009, 550 % up than January 2008.
The sharp increase was already preceded by a 567 % on-year spike in gas and oil exports last December to 200,000 tons.