Become a 300,000-ton Polypropylene Project in Daqing where the Resources are Winning in the Market--the Tenth Five-Year Key Projects

The 300,000-ton-per-year polypropylene project at China National Petroleum Daqing Refinery Branch is one of the key initiatives driving the revitalization of the old industrial base in Daqing. It currently holds the title of the largest single-line production capacity for polypropylene in China. Since its launch earlier this year, the plant has been operating smoothly and concluded its first phase in November. During the summer, it successfully produced 42,000 tons of high-grade polypropylene, generating over 300 million yuan in sales revenue. This achievement not only brought significant economic returns but also helped alleviate the domestic supply-demand imbalance for polypropylene. More importantly, it provided strong impetus to the local economy and triggered positive ripple effects across related industries. At present, Daqing Refining & Chemical Branch has demonstrated strong technical capabilities, producing high-impact copolymers with excellent rigidity, toughness, and fluidity balance, as well as random copolymers, BOPP and CPP films, fiber and non-woven materials, and high-end automotive parts and home appliance components. These products are helping to upgrade the structure of China’s polypropylene industry. Taiwan's Formosa Plastics Group is in talks with Daqing City to establish a plastic processing base there. This initiative could extend the local petrochemical industry chain and accelerate the growth of the plastic processing sector in Daqing and the broader northeast region. In line with the original design, Daqing Petrochemical Branch has started supplying 74,000 tons per year of propylene raw material to the new 300,000-ton polypropylene plant. It has already secured a 300,000-ton annual supply agreement with Daqing Refinery. The issue of mutual raw material supply for the planned 450,000-ton polypropylene project during the "Eleventh Five-Year Plan" period is a critical factor in determining the scale of future development. According to Xu Zhanwu, a senior engineer from the Chinese Petroleum Group’s chemical expert team and deputy chief engineer at Daqing Refining & Chemical Company, the 300,000-ton polypropylene project, which cost 1.243 billion yuan in total investment, was designed with a high technological standard from the beginning. The project emphasized modernization and market orientation in its decision-making process. Historically, China has been a major importer of polypropylene, with high-grade copolymer materials largely dominated by foreign imports. Although domestic production has grown rapidly in recent years, it still struggles to meet the rising demand in terms of quantity, quality, and variety. As a result, import volumes have continued to rise. According to current planning, domestic polypropylene resin production capacity is expected to reach 5.69 million tons per year by 2005, narrowing the market gap to 2.75 million tons. However, after 2005, capacity growth will slow, and the market gap is expected to widen further. By 2015, around 9.14 million tons of polypropylene will need to be imported to meet demand. Xu Zhanwu noted that the Daqing plant has a clear competitive advantage, primarily due to its raw material availability. Daqing's crude oil is easily cracked, with a high content of light hydrocarbons. The completed 600,000-ton ethylene plant of Daqing Petrochemical can supply at least 74,000 tons of propylene annually to polypropylene plants. Additionally, Daqing Refinery has developed its own technology for propylene production, capable of supplying 300,000 tons of propylene per year through plant upgrades. With increasing propylene output from both Daqing Petrochemical and Daqing Refinery & Chemical, the raw material advantage will become even more pronounced. To enhance the competitiveness of China’s polypropylene products in the market, the company has focused on developing impact and copolymer products with balanced performance, random copolymers, BOPP and CPP films, fiber and non-woven materials, as well as applications in automobiles and household appliances. These areas are seen as key research directions for future development. The Daqing Refining & Chemical Company’s 300,000-ton polypropylene plant can produce 103 types of specialized resins, making it the largest polypropylene producer in China. Looking ahead, the company plans to expand its production of high-grade copolymer materials. With sufficient raw material supply and a vast market potential, Daqing Refining & Chemical Company is planning to invest an additional 1.8 billion yuan to build a new 450,000-ton polypropylene plant, which is scheduled to be completed during the "Eleventh Five-Year Plan." The company is currently working on industrial technologies to expand propylene raw material production through technical upgrades and internal R&D, including the 120,000-ton ARGG (heavy oil catalytic cracking unit). An additional ARGG unit is planned during the "Eleventh Five-Year Plan" to support the new polypropylene plant. Once operational, the polypropylene production capacity of Daqing Refinery Branch will reach 750,000 tons per year.

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