CNOOC Group has been selling crude oil and providing related services to Orient Petrochemical, while Orient Petrochemical has been selling refined products and chemicals to CNOOC Group in the ordinary course of its business, including refined oil, fuel oil, bitumen, liquefied petroleum gas, naphtha, Methyl tert-butyl ether, propylene, sulfur raw materials and styrene, etc.

In order to better manage the Group’s continuing connected transactions and comply with the relevant requirements of Chapter 14A of the Listing Rules, on June 30, 2022, the company entered into the Orient Petrochemical Continuing Connected Transaction Agreement with certain subsidiaries of CNOOC, and became the company from Orient Petrochemical. Effective from the date of the subsidiary and expires on December 31, 2023.

The announcement stated that the proposed acquisition is in line with the general trend of the petrochemical industry developing towards high-end chemical industry and the requirements of energy conservation and emission reduction policies. During the “14th Five-Year Plan” period, the competition in the petrochemical industry will further intensify, the industry will enter a period of overcapacity reduction, and the adjustment period to make up for shortcomings. The chemical industry will develop towards high-end chemical products based on synthetic materials. Dongfang Petrochemical has good resource support, and its petrochemical capacity can provide abundant carbon and hydrogen elements. The guarantee of these basic chemicals will provide the company with a huge future in the development of new chemical materials and functional chemicals. Development space, implementation conditions and scientific and technological support. The proposed acquisition will enable the company to form an efficient development model integrating natural gas chemical industry and petrochemical industry, make better use of the advantages of light crude oil and carbon-rich natural gas resources in the South China Sea, avoid risks, increase efficiency and improve profitability.

The proposed acquisition is also in line with the company’s strategic development requirements for the deployment of acrylonitrile business. The field of new chemical materials is the company’s key transformation and development direction in the future. Considering the company’s industrial base, resource endowment and other factors, the company plans to use Fudao Chemical’s self-produced liquid ammonia and Dongfang Petrochemical’s production of propylene, styrene and other raw materials to build acrylonitrile project. , and based on this, extending to the downstream industry chain and deploying high-end chemical new material industries such as ABS is an effective way for the company to transform and develop the chemical new material industry. From the perspectives of industrial development planning, product portfolio, location logistics, and local policies, Dongfang Petrochemical is a more suitable acquisition and integration target, and can further stimulate the profit potential of the assets through technological transformation and cost reduction and efficiency enhancement measures.

The total investment is nearly 2.8 billion! CNOOC Dongfang Petrochemical started construction of acrylonitrile, MMA and other units

In July 2020, the Hainan Free Trade Port Construction Project (the second batch), which was held simultaneously in 18 cities and counties (districts) in Hainan Province, started intensively. The acrylonitrile series device project of the second phase of CNOOC Dongfang Petrochemical Hainan Fine Chemical Project is among the projects under construction. The project has a total investment of 2.776 billion yuan and is expected to be completed and put into operation this year.

Among them, the acrylonitrile project will make overall use of the existing methanol, liquid ammonia, propylene and other resources in the Eastern Industrial Park, optimize the combination, and produce high value-added acrylonitrile and methyl methacrylate, which are important basic organic raw materials and polymer materials. Single product.

The construction scope of the acrylonitrile project includes 200,000 tons/year acrylonitrile plant, 70,000 tons/year MMA plant, 214,000 tons/year SAR plant, 120,000 tons/year ethylbenzene styrene plant, as well as supporting public works facilities, peripheral auxiliary facilities facility.

The construction of the acrylonitrile project will not only expand the downstream industrial chain of CNOOC and enhance the overall strength of downstream enterprises, but will also contribute to the promotion of the construction of the Eastern Industrial Park and the acceleration of the development of Hainan Free Trade Port.

After the completion of this batch of projects, it will further optimize the industrial structure layout of the Eastern Industrial Park, accelerate the construction and development of Hainan Free Trade Port, and promote the sustainable economic and social development of Hainan.

The proposed acquisition is conducive to taking advantage of the location advantage and realizing synergistic economic effects. Dongfang Petrochemical and Fudao Chemical are located in the same production park. After the delivery, Dongfang Petrochemical and Fudao Chemical will be under the unified management of the company, and take advantage of the integration through measures such as mutual supply of materials, optimized management, integration of land and public engineering resources, and simplified management. Improve the overall safety level and help regional coordinated development.