China's Sinopec Hasn't Requested Extra Saudi Oil: Chairman

Saturday, Jan 14, 2012

DHAHRAN, Saudi Arabia (Dow Jones)--China Petrochemical Corp. (SNP), or Sinopec Group, has not requested any additional crude oil supplies from Saudi Arabia, despite pressure from the U.S. to slow or halt crude oil imports from Iran, Sinopec chairman Fu Chengyu said Saturday.

Fu declined to respond to questions about whether Sinopec would reduce its oil purchases from Iran, though he said he didn't think U.S. pressure for tougher sanctions against the Islamic Republic would be damaging to Sinopec.

"I don't think so," Fu told Dow Jones soon after signing an agreement with Saudi Arabian Oil Co., or Saudi Aramco, to build a 400,000 barrel a day joint venture refinery at Yanbu, on the Red Sea coast of Saudi Arabia.

China has so far given a cold reception to U.S. requests to slow or halt crude-oil imports from Iran, the Asian country's third-largest supplier after Saudi Arabia and Angola. China is Iran's largest crude customer.

Sinopec's trading unit Unipec imports 220,000 barrels of oil a day from Iran and 550,000-650,000 barrels a day from Saudi Arabia.

Asked if Sinopec had requested additional supplies from Saudi Aramco, Fu responded: "No. We are trying to secure the market there in China...we have (a) good contract already (with Saudi Aramco) and we will continue with it."

Fu's comments concide with a visit by Chinese Premier Wen Jiabao to Saudi Arabia, the first stop in a six-day tour of the Middle East. Wen's visit comes amid an intense debate in Asia over crude oil supplies, prompted by U.S. moves to impose sanctions on Iran, a mainstay of East Asia's energy supply.

Sinopec Group will hold a 37.5% stake in the new Yanbu refinery project, known as Yasref, while Saudi Aramco will own 62.5%. The refinery is due to start operations in 2014.

Fu said that Sinopec will sell its share of the refinery project's output to any country "where we can make money."

-By Summer Said, Dow Jones Newswires; +966-546-842373; summer.said@dowjones.com

(END) Dow Jones Newswires

14-01-12 1201GMT