BASIC IMAGERY INTERPRETATION REPORT CHINA'S PETROCHEMICAL INDUSTRY

• Document Type: CREST
• Collection: NGA Records (Formerly NIMA)
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00909A001000010048-3
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 18
• Document Creation Date: December 28, 2016
• Document Release Date: May 29, 2008
• Sequence Number: 48
• Publication Date: September 1, 1976
• Content Type: REPORT

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Top Secret
25X1
Industrial Facilities
(Non-Military)
Basic Imagery Interpretation Report
China's Petrochemical Industry
Top Secret
September 1976
Copy
Pages 31
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Top Secret RUFF
CENTRAL INTELLIGENCE AGENCY
Directorate of Intelligence
Imagery Analysis Service
CHINA'S PETROCHEMICAL INDUSTRY
A total of ten petrochemical complexes or plants have been identified
to date on photography of China. They range from small Chinese-designed
plants producing only a single product to large integrated complexes
employing the latest Western technology. Three of these, large petro-
chemical complexes containing plants imported from Japan and western
European countries, are scheduled to come on-stream in 1976 and 1977.
These three complexes will enable the Chinese to produce greatly increased
quantities of plastics, synthetic fibers, and probably synthetic rubber
during the latter half of the 1970s.
We estimate that the total annual ethylene production capacity, the
best indicator of a country's petrochemical capacity, will increase from
under 50,000 metric tons in 1970 to about 585,000 metric tons in 1977.
We estimate that over the same period plastics production from petroleum
feedstocks will increase from 32,000 metric tons annually to about
390,000 metric tons, and synthetic fibers production from petroleum will
increase from only minimal production to about 300,000 metric tons.
This report summarizes the development of the Chinese petrochemical
industry and discusses the production capacities for the major categories
of petrochemical products. It also includes a brief description and a
photograph of each of the ten petrochemical complexes or plants.
Comments and ueries re ardin this publication are welcomed. They
may be directed to of the Economic Resources Division, 25X1
IAS 25X1
RCS- 13/0037/76
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PEKING
3? ?
2?
1.
CHI-LIN-HSIANG
6. NAN-CHING
2.
CHIN-SHAN-WEI
7. SA-ERH-TU
3.
FANG-SHAN
8. SHANGHAI
4. LAN-CHOU
9. WANG-CHU-CHUANG
5. LIAO-YANG
10. YANG-LIU-CHING
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The rapid expansion of the Chinese petrochemical industry will
enable China to produce increasing quantities of plastics, synthetic
fibers, and probably synthetic rubber during the latter half of the
1970s (Tables 1 - 3). Most of this increased production will result
from China's program of whole-plant purchases from the more industrialized
non-Communist countries. In the past, the Chinese relied primarily on
inefficient processes based on coal and inorganic chemicals to fulfill
their requirements for those products which in the industrialized
countries, are produced from petroleum feedstocks.
Ten petrochemical complexes or plants have been identified to date
on photography of China -- nine in eastern China and one in the west, at
Lan-chou (Figure 1). Table 2 lists the plants, their final products,
and, where possible, their reported or estimated production capacities.
This report discusses in detail only those plants which use a
petroleum or natural gas feedstock. The production capacity figures
given for plastics, synthetic fibers, and synthetic rubber are based
only on these plants and do not include the capacities of plants which
use coal or other non-petroleum feedstocks.
Most of the production capacities for the imported plants involved
in this report have been derived from collateral reporting. Although
some collateral is available on the indigenous plants, most of their
production capacities have been estimated by comparing them with similar
plants in the USSR, Europe, and the U.S.
Development of the Industry
China's petrochemical industry is just beginning to emerge as a
significant factor in its economy. In the 1950s, the Chinese lacked
both the petroleum resources for petrochemical feedstocks and the
technological expertise required for a significant output of petrochemical
products. The discovery of the Ta-ching and Pohai oil fields in the
early 1960s solved the problem of feedstock availability. Also in the
early 1960s, the Chinese began a program to increase their technological
expertise through the construction of a group of pilot-plant-sized
petrochemical units at Shanghai. A small collocated ethylene plant,
apparently of indigenous design, supplied the feedstocks for these units.
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By the mid-1960s, such small-capacity units could not satisfy
China's need for petrochemical products. The Chinese, however, had
developed neither the process technologies nor the metallurgical and
fabrication expertise needed to construct large-scale processing units.
As a result, they turned to the West for more modern, larger-capacity
equipment, importing an integrated petrochemical complex with plants
from both Great Britain and West Germany in 1964 and 1965. This complex
was built in Lan-chou, at the site of an older grain-alcohol-based
synthetic rubber plant, and came on-stream between 1966 and 1971.
Although the capacity of the Lan-chou complex was not large -- the
ethylene capacity was only about 40,000 metric tons per year (mt/yr) --
it did represent a major technological advance over earlier indigenous
plants.
Completion of the Lan-chou complex may have been delayed by the
Cultural Revolution and by a continuing lack of Chinese technological
expertise. In any event, no more large petrochemical plant purchases
were made in the 1960s. In the late 1960s, however, construction on a
new Chinese-designed petrochemical complex began at Fang-shan, in a
hilly area southwest of Peking. Although this complex produces a wide
variety of products, the capabilities of the individual production units
are, by world stands, very limited and certainly not adequate to fulfill
China's growing need for petrochemical products.
In late 1972 and 1973, China began ordering petrochemical plants
from Japan and the West. CIA/OER estimates that from 1973 to 1975 these
orders amounted to $1.5 billion. 1/ They included ethylene plants,
synthetic fibers plants, plastics plants, and ammonia/urea fertilizer
plants. The large ammonia/urea plant import program will not he included
in this report. It was previously discussed in an IAS Basic Imagery
Interpretation Report. 2/
With the exception of the 13 urea fertilizer plants and the vinylon
fibers plant at Chang-shou, all of the recently imported plants that
have been observed under construction are at either the two new petrochemical
complexes at Chin-shan-wei and Liao-yang or at the existing complex at
Fang-shan. In contrast to the delays experienced in getting the imported
plants at Lan-chou on-stream in the 1960s, construction at these three
complexes is apparently proceeding on schedule.
Site preparation for the large Chin-shan-wei complex was observed
in early 1973 and some units were complete by late 1975. At Fang-shan,
site preparation for the imported units was under way in early 1974 and
evidence of trial operation of the ethylene plant was observed in late
1975. The Liao-yang complex is still in an early stage of construction,
with its units not scheduled to start coming on-stream until 1977.
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Petrochemical Production Capacity*
Feedstocks. The Fang-shan, Chin-shan-wei, and the Liao-yang
complexes will each contain an ethylene plant to produce feedstocks for
the other units in the complex. Since ethylene is the most common
feedstock for petrochemical production, it is the best single indicator
of total production capacity. China's ethylene capacity was approximately
48,000 mt/yr in 1970.** We project that by the end of 1976 this ethylene
capacity will have increased more than tenfold to about 513,000 mt/yr
and to 586,000 mt/yr by the end of 1977 (Figure 2). Production of
propylene, another important petrochemical feedstock produced by the
ethylene plants, will increase proportionately.
* Capacity estimates for Chinese units should be considered tentative.
** Capacity totals do not include ethylene recovered from refinery off-gas.
0 ESTIMATED CAPACITY
1 1965 1 1966 1 1967 1968 1 1969 1 1970 1 1971 1 1972 1973 1 1974 1 1975 1 1976 1 1977
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Table 1.
Estimated Ethylene Production Capacity for 1977
(Metric Tons Per Year)
1.
Complex
Fang-shan
Capacity
300,000*
Percent of
Total Capacity
51
Remarks
Imported.
2.
Chin-shan-wei
120,000*
20
Imported.
3.
Lan-chou
40,000*
7
Imported.
40,000
7
Copy of imported plant;
4.
Liao-yang
73,000*
12
under construction.
Imported plant; under
5.
Shanghai
8,000
2
construction.
Chinese design.
6.
Nan-ching
5,000
1
Chinese design.
586,000
100%
*Reported capacities; others are estimated.
Despite the percentage increases anticipated, China's total ethylene
production capacity will remain small by world standards. The 513,000
mt/yr of ethylene projected for 1976 is less than 5 percent of the
United States' 1975 capacity. However, a single large ethylene plant,
at Fang-shan, will produce about half of China's ethylene through 1977
(Table 1). Continued construction of such large-capacity plants would
allow China's petrochemical feedstock capacity to continue to grow.
Production of petroleum aromatics (benzene, toluene and xylenes),
another important category of petrochemical feedstocks, has been rising
steadily as a result of increased catalytic reforming capabilities at
Chinese petroleum refineries. The new ethylene plants will produce
additional aromatics. One of these, paraxylene, is especially important
as a feedstock for polyester fibers. No estimate of China's total
aromatics production is available.
Figure 3 illustrates a simplified process flow from feedstock
through final product for the petrochemical plants identified in China.
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BUTANE
BUTADIENE
CRACKED
GASOLINE
7
BUTANES
POLYVINYL
CHLORIDE
SYNTHETIC
RUBBERS
COPOLYMER
RUBBERS
POLYVINYL
ALCOHOL
ETHYLENE
GLYCOL
Top Secret
POLYESTER
FIBERS
DIMETHYL-
TE RE PHTHALATE
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Name
Type
Capacity
(Metric Tons/
Year)
Completed
Tvpe
Capacity
(Metric Tons/
Year)
Completed
Tvpe
Capacity
(Metric Tons/
Year
Completed
l
Prob chl of lei
caustic soda
Urea
asacits
etric Tons;
Year)
Cnknown
Unknown
Comol eted
1973
1973
late of
l nformati on
3cc 15
Chin-shan-wei
Acrylic
50,000*
1976
Polyethylene
60,000*
1975
Vinylon
36,000*
1975
Poss polyester UC
25,000*
1976
Prob polypropylene
2,000
1972
Polybutadiene
15,000
1972
Phenol/acetone
Unknown
1973
for 76
Polystyrene
3,000
1972
Pass polyisoprene
Unknown
1973
Polypropylene IIC
80,000*
1976
Polyethylene UC
180,000*
1976
Vinyl chloride**
80,000*
1976 (1977)
1971
Polyethylene
24,000*
:969
Butadiene/styrene
5,000*
1963
Jan 76
Polypropylene
8,000*
1969
Polybutadiene/nitrile
20,000*
1966
Liao-yang
Polyester UC
87,000*
1977
Prop polyethylene UC
35,000*
1977
Mar 76
Nylon UC
46,000*
1977
Polypropylene**
35,000*
1978
May 76
Sa-erh-tu
Acrylic
2,000
1972
Jun 75
Shanghai
Ross acrylic
11500
1972
Polystyrene
Small
1972
Phenol/acetone
Unknown
1971
May 76
Wang-chu-chuang
Yang-liu-chingt
Polyethylene
Small
1972
Oec 75
Oar 76
TOTALS - 99,500 on-stream 97,000 on stream
158,000 under construction 295,000 under construction
115,000 projected for construction
51,000 on-stream
11,000 under construction
*Reported capacities; others are estimated (see individual plant tables for primary and intermediate feedstock petrochemicals produced at
these plants).
**Unit reported purchased but not yet observed on photography. Dates are for scheduled completion; the date in parentheses is estimated from photography.
(Final products of these plants cannot yet be determined.
Plastics Production. China's plastics production from petrochemical
feedstocks was concentrated at Lan-chou in the early 1970s. Smaller
quantities of plastics were produced at Fang-shan and Shanghai.
Polyethylene was the most commonly produced plastic, accounting for
24,000 mt/yr out of a total capacity of 37,000 mt/yr. This emphasis on
the production of polyethylene continued with the plants purchased from
1973 to 1975. We project that a plastics capacity of 392,000 mt/yr will
be available when all of the plants observed under construction are in
operation, probably during 1977 (Figure 4). Of this total, more than 75
percent (or 299,000 mt/yr) will be polyethylene. Polypropylene will
account for nearly all of the remaining projected plastics capacity.
The major end products produced from polyethylene plastics are
films and sheeting. Other less important products include moldings,
cable and wire sheathing, and pipe. Polypropylene is most widely used
in moldings, but it can also be used as a synthetic fiber.
The Fang-shan complex will be China's major plastics producer by
the end of 1976. The 180,000 mt/yr capacity of a single polyethylene
plant at Fang-shan will account for over 45 percent of China's projected
plastics production capacity for 1977.
Synthetic Fibers Production. While Fang-shan will be the major
producer of plastics, the two new imported petrochemical complexes,
Chin-shan-wei and Liao-yang, will primarily produce synthetic fibers.
The Chin-shan-wei complex, which began initial testing of some units in
late 1975, should be in full operation in 1976. It will produce acrylic,
vinylon, and polyester fibers, with a combined design capacity of 111,001)
mt/yr. Liao-yang, scheduled to begin coming on-stream in 1977, will
produce polyester and nylon fibers with a combined design capacity of
133,000 mt/yr.
In addition to the fibers facilities at these two complexes, we
have observed two confirmed and two possible acrylic fibers plants in
China. The oldest of the confirmed plants, at Lan-thou, was imported
from West Germany and was first observed operating in 1971. The only
other plant to be confirmed on photography, a small-capacity plant of
indigenous design at Sa-erh-tu, became operational in 1972. The two
possible acrylic fibers plants are at the Shanghai and Chi-lin-hsiang
complexes. The small-capacity Shanghai plant appears to be Chinese
designed. The Chi-lin-hsiang possible acrylic fibers plant has a much
larger capacity, and the size and general layout of its equipment suggest
that it was constructed with foreign aid. We are not yet able to
estimate the capacity of the Chi-lin-hsiang plant.
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SYNTHETIC FIBERS
SYNTHETIC RUBBER
PLASTICS
NOTE: SSOLIDrINDICATES ON-STREAM TED
j
j
0
FIGURE 4. GROWTH OF CHINESE PETROCHEMICAL PRODUCTION CAPACITY, 1970-1917.
Note: Graph includes only the production capacity of those facilities identified on photography.
China's total estimated production capacity for synthetic fibers
from petrochemical feedstocks was under 14,000 mt/yr prior to 1975
(Figure 4). As the recently imported plants come on-stream, this
capacity is expected to rise to a total of 169,500 mt/yr by the end of
1976 and to 302,500 mt/yr by the end of 1977. This is about 10 percent
of present US production. These total figures for China do hot include
production from China's vinylon plants (except the petroleum-based one
which is integrated into the Chin-shan-wei Petrochemical Complex and the
natural-gas-based Chang-shou plant). China's vinylon fiber industry was
previously discussed in an IAS Imagery Interpretation report. 3/
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Table 3. Estimated Chinese Synthetic Fiber Production Capacity, 1974 - 1980
(Metric Tons Per Year)
1974 1975 1976 1977 1980
Acrylic 13,500 13,500 63,500 63,500 63,500
Nylon -- -- -- 46,000 46,000
Polyester -- -- 25,000 112,000 202,000*
Vinylon** -- 36,000 81,000 81,000 81,000
Total 13,500 49,500 169,500 302,500 392,500
*Includes the 90,000 mt/yr capacity of the dimethyl terephthalate (DMT)
plant which has been purchased by the Chinese and which we believe will
be built at Fang-shan. DMT is an intermediate in polyester production.
**Capacities of China's only vinylon plants using a petrochemical
feedstock -- Chin-shan-wei and Chang-shou.
By 1977, polyesters will account for over 50 percent of China's
total synthetic fibers production capacity, while at present, acrylic
and vinylon fibers account for most of it. Additional amounts of
synthetic fibers could also be made from polypropylene. Table 3 lists
our estimates of China's production capacity for each of the four types
of synthetic fibers from 1974 to 1980.
Synthetic Rubber Production. The Chinese are apparently experiencing
technical problems in expanding their synthetic rubber industry. After
relying primarily on imported plants and the foreign-designed Lan-chou
plant in the 1960s, the first full-scale, domestic-designed, petroleum-
based synthetic rubber plant was constructed at Fang-shan between 1970
and 1972. However, since its completion, Fang-shan reportedly has
experienced production outages caused by process control or design
problems.
Construction of a second domestic plant, similar in design to
Fang-shan, began at Wang-chu-chuang in early 1971. Although construction
of the plant proceeded slowly, it appeared to be capable of operation in
late 1975. The plant, however, has not been observed in operation. A
third domestic synthetic rubber plant, also similar to Fang-shan, has
been under construction at the Chi-lin-hsiang complex since early 1972.
Little progress has been made in the construction of this plant since
1973, and construction may have been discontinued. Operation and
construction delays observed at the Wang-chu-chuang and Chi-lin-hsiang
plants, respectively, may have resulted from problems similar to those
encountered at the prototype Fang-shan plant.
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We estimate that China's synthetic rubber production capacity from
petroleum feedstocks was 25,000 mt/yr in 1970, all from the Lan-chou
complex. This figure includes the capacities of both the imported
rubber plant and the older grain-alcohol-based plant which was apparently
being converted to the use of petrochemical feedstock. With the completion
of the Fang-shan and Wang-chu-chuang plants, China's total projected
synthetic rubber production capacity increased to about 51,000 mt/yr by
the end of 1975, but actual production of synthetic rubber has probably
been significantly less. Except for the Chi-lin-hsiang plant, no synthetic
rubber plants are known to be under construction.
No synthetic rubber plants were included in the plants imported
between 1973 and 1975 for construction at the Fang-shan, Chin-shan-wei,
and Liao-yang complexes. The three new ethylene plants at these complexes
could, however, produce a combined total of about 74,000 mt/yr of
butadiene, a basic feedstock for synthetic rubber production. The
Chinese apparently do not have the capability to design and construct
synthetic rubber plants of a scale large enough to use these available
quantities of feedstock. They may, therefore, decide to purchase
large-scale rubber plants just as they have purchased plastics and
synthetic fibers plants.
Trends
The future output of petrochemical products will depend largely
upon the rate at which the Chinese purchase large-scale whole plants
and their ability to construct these plants. This is especially
important for the future synthetic rubber production, since butadiene
feedstock will be readily available to supply such plants. Equally
important to the future of the petrochemical industry is the degree
of success the Chinese have in copying some of the new large-capacity
plants they have imported. They are currently attempting to construct
a second ethylene plant at Lan-chou patterned after the imported
ethylene plant already at that complex. Despite these limiting
conditions, it appears that the Chinese petrochemical industry will
continue to expand rapidly at least through 1978 and probably into
the 1980s.
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This section provides basic descriptions and annotated photographs
of each of the ten known Chinese petrochemical facilities. These
descriptions include major petrochemical products, locations (including
nearby related plants), transportation connections, and a construction
chronology. In most cases, we also provide a table summarizing each
major processing area, including function or product(s), estimated
production capacity where possible, source of equipment, the years in
which construction was begun and completed, and other pertinent remarks.
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Iq
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Imagery
Selected satellite photography was used in preparing this report.
Documents
1. CIA. ER 76-10157, China: The Petrochemical Industry, March 1976
(SECRET/Not Releasable to Foreign Nationals)
2. CIA. RCS-13/0022/75,1 I Urea Fertilizer Production 25X1
Facilities in China, June 1975 (TOP SECRET RUFF
3. CIA. RCS-13/0013/76, Vin,ylon Plants in China,
May 1976 (TOP SECRET RUFF)
Requirement
COMIREX N08
Support Number 460877 EN
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