Further investment in China Major contract with Sinopec

November 21, 2011

Air Liquide and Sinopec (China Petroleum and Chemical Corporation) have agreed on the supply of gaseous oxygen and nitrogen to Maoming branch of Sinopec (MPCC) 200,000 Nm³/h coal-to-hydrogen project and existing refinery in Maoming, Guangdong province, China.

This refinery expansion project by MPCC is one of the major projects of Sinopec, and will enable MPCC to produce cleaner fuels meeting higher environmental standards. After completion of the project, MPCC will become one of the biggest refineries in China with a capacity exceeding 20 million-ton oil refining per year.

The supply will be based on the investment in a new ASU with a capacity of 3,000 tonnes of oxygen per day which will be the largest ASU to be built in China. The new ASU, expected to be commissioned in the first half of 2013, will also produce liquid oxygen, nitrogen and argon to meet the strong and growing demand in the industrial merchant market in South China. This very large ASU will be designed and manufactured by Air Liquide Hangzhou, Air Liquide’s engineering center in China, using the Group’s latest technologies providing both high reliability and energy efficiency.

For the gas supply to MPCC, Air Liquide and Sinopec have entered into a 50/50 joint venture. Under the terms of the contract, the joint venture will also take over and operate MPCC’s existing Air Separation Units (ASUs).

The global investment of the joint venture will be around €85 million.

Air Liquide and Sinopec, Asia’s largest petroleum and petrochemical group, have had a long-term partnership. In December 2007, Air Liquide set up a 50/50 joint venture company with Sinopec Tianjin Petroleum Chemical Corporation (TPCC) in Dagang, Tianjin, to supply oxygen and nitrogen to TPCC’s new 1 million-ton per year ethylene cracker and downstream units. Air Liquide also supplies Sinopec Qingdao Refinery.

Yu Xizhi, General Manager of MPCC, said: “MPCC refinery revamping and expansion is a key national project. We have chosen Air Liquide as our partner to benefit from its state-of-the-art technology and excellence in operational management, to ensure a safe, efficient and reliable gas supply. We see a bright future for a win-win partnership with Air Liquide, the world leading industrial gas supplier.”

Jean-Marc de Royere, Senior Vice-President Asia Pacific and a member of the Air Liquide Executive Committee, said: “This is a new step in our relationship with Sinopec and another milestone for Air Liquide in China’s refining industry. We are very pleased to partner with MPCC in this major project and to participate to the dynamic and growing Southern China market. Air Liquide remains committed to the Chinese market in offering comprehensive solutions with leading-edge technologies. Developing Economies are a growth driver of the Air Liquide group.”

The Large Industries Business Line of the Air Liquide Group

offers gas and energy solutions that improve process efficiency and help achieve greater respect for the environment, mainly in the refining and natural gas, chemicals, metals and energy markets. 2010 revenues were €4,019 million.

Air Liquide in China

operates today about 60 plants and employs 4,000 people, with a presence in the key coastal industrial areas, while expanding into the center, west, south and the northeast.

Air Liquide has also strong Engineering capabilities based in Hangzhou and Shanghai.

Air Liquide returned to China in the 1970s to supply air separation units and restarted gas operations in 1990.