China’s Hengli to receive first Saudi crude oil shipment by July

Chinese chemical producer Hengli Group will receive its first 2 million barrels of Saudi medium crude oil delivery by July, Reuters reported Wednesday, citing source familiar with the matter.

The Chinese firm is preparing a new 400,000 barrels-per-day (bpd) refinery for trial runs to be held in October. It will become one of the five largest refineries in China and a major Saudi crude oil buyer, processing medium and heavy crude grades from Saudi Arabia.

For this trial runs, Hengli expects to import up to 22 million barrels of crude this year, the source added.

The Saudi oil shipment will be imported by the Chinese state oil firm Sinochem Corp, with which Hengli will open a joint venture trading office in June in Singapore to purchase crude for the refinery and sell oil products produced there, trade sources said.

Moreover, sources highlighted that Hengli is in talks with Saudi Aramco for long-term supplies, although both parties did not respond to requests for comment.