PetroChina Refinery Catches Fire But Operations Unaffected
Zacks Investment Research | Aug 21, 2017 10:48PM ET
PetroChina Company Limited (NYSE:PTR) suffered a setback recently as a fire broke out at Dalian refinery owned by the state-run integrated oil major. However, there were no casualties.
The fire started due to a broken seal in a feed pump. Consequently, the refinery plant's 1.4 million tonnes per annum catalytic cracker, used for producing gasoline, caught fire. The feedstock equipment, attached to the catalytic cracker was separated, which saved the other units from being affected. Although crude processing operations in the Dalian refinery were not impacted by the fire, production from the gas separation unit might witness a decline.
The environmental inspection was carried out in the facility after the fire was extinguished. It revealed that the containment pools installed at the facility arrested pollutants from entering the coastal waters. Air quality monitoring stations in the locality found no unusual emissions in the area following the fire.
We note that the Dalian refinery had suffered a setback in 2013 when an explosion injured two people.
Dalian Refinery in Focus
Dalian refinery, located in northeast China's Liaoning Province is one of the largest refineries in the country. The plant has three crude distillation units and a processing capacity of 410,000 barrels of crude oil per day. It has been only two months since the last major maintenance in the facility.
Part of the crude oil processed at the facility comes from PetroChina’s own production in the Daqing oil region. Another major supplier of the refinery is Saudi Arabia. Dalian refinery produces gasoline, diesel and liquid petroleum gas.
About PetroChina
PetroChina is the largest integrated oil company in China. It was established in Nov 1999 as part of the restructuring of China National Petroleum Corporation (“CNPC”), a state-owned entity, which currently holds a stake of 86.35% in PetroChina. The company operates in four segments: Exploration & Production, Natural Gas & Pipelines, Refining & Chemicals, and Marketing.
Crude downturn and cuts in domestic natural gas supply prices to industrial customers have wiped out earnings and hit PetroChina hard. China's weakened industrial activity has dampened demand for the company's products like diesel.
Price Performance
PetroChina has lost 16.8% of its value year to date compared with 7.3% fall of its Zacks Investment Research
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