Shangdong Yulong lets contract for proposed integrated refining megacomplex

Nanshan Holdings Co. Ltd.’s majority held Shandong Yulong Petrochemical Co. Ltd. has let a contract to Lummus Technology LLC to provide licensing for an alkylation unit to be installed at the planned grassroots 20-million tonnes/year (tpy) integrated refining and petrochemical complex under construction as part of the Yulong Island Refining and Chemical Integrating Project at Yulong Petrochemical Industrial Park, Yantai City, Shandong Province, China (OGJ Online, Feb. 8, 2021).

As part of the Feb. 17 contract, Lummus will license its CDAlky technology to outfit a new 400,000-tpy alkylation unit that will produce very high-octane, gasoline-blending alkylate to improve fuel efficiency and reduce environmental impacts of finished gasoline product at the site, the service provider said in a release.

Lummus’ scope of work on the project also will include delivery of basic engineering, technical services, and supply of proprietary equipment for the new unit.

This latest contract to Lummus for the Yulong Island complex follows Shandong Yulong Petrochemical’s previous award to the service provider for proprietary technologies to be implemented at the complex’s two mixed-feed crackers, an ethylbenzene-styrene monomer (EB-SM) plant, and two polypropylene (PP) plants (OGJ Online, Nov. 17, 2020).

The alkylation technology licensing contract for the proposed integrated complex also follows the operator’s nearly 2-billion yuan major contract award in 2021 to Shaanxi Chemical Construction Engineering Co. Ltd. for engineering and construction on two sections of Phase 1 of the project’s main complex, as well as construction of the refinery’s light hydrocarbon tank farm project, Shaanxi said in a release on Jan. 22, 2022.

While local media out of China have reported other unconfirmed contracts let for work on Phase 1 of the planned complex, Nanshan has revealed scant information about the project, seemingly because of financial constraints in advancing construction of the proposed megacomplex.

In late 2021, Nanshan alongside fellow partners Wanhua Chemical Group Co. Ltd. and China Hualu Group Co. Ltd. jointly entered a capital increase and expansion, or equity restructuring, agreement for Shangdong Yulong Petrochemical with Shandong Energy Group Co. Ltd.—a Shandong provincial government entity—under which Shandong Energy replaced former investor Shandong Development & Investment Holding Group Co. Ltd. to take a 46.1% interest in the project, according to separate notices from Shandong Supervision Office of National Energy Administration and Shandong Energy posted on Nov. 22, 2021.

Under the revised partnership, Nanshan will hold a 51% interest in Shandong Yulong Petrochemical, with Wanhua and Hualu to hold a combined 2.9% interest in the venture, according to Chinese local media.

With new partners in place and to be fast-tracked in line with China’s ecological priority for a green, low-carbon future, Phase 1 of Shandong Yulong Petrochemical’s planned complex is scheduled for startup in June 2023, Nanshan said in a Nov. 23, 2021.

Operating details

Budgeted at an investment of nearly 127.4-billion yuan, official project documents from China’s Ministry of Ecology and Environment (MEE) show the Yulong Island Refining and Chemical Integrating Project (Phase 1)—which began construction in late-October 2020—will include the following major units and available planned capacities in addition to the newly announced alkylation unit:

• One 10-million tpy atmospheric distillation unit.
• One 10-million tpy combined atmospheric-vacuum distillation unit.
• Two light hydrocarbon recovery units.
• One 2.6-million tpy slurry bed residue hydrogenation unit.
• One 1.2-million tpy solvent deasphalting unit.
• One 100,000-cu m/hr residual oil hydrogen production unit.
• Three 2.6-million tpy residual oil hydrotreating units.
• One 1.5-million tpy wax oil hydrotreating unit.
• One 2-million tpy wax oil hydrocracking unit.
• One 500,000-tpy heavy oil, high-pressure hydrogenation unit.
• One 3.4-million tpy diesel hydrotreating unit.
• One 3.6-million tpy diesel hydrocracking unit.
• One 1.4-million tpy kerosene hydrogenation unit.
• One grassroots hydrogen centralized supply station.
• One 4-million tpy catalytic cracking unit.
• One 1.6-million tpy gas fractionation unit.
• One 1-million tpy pyrolysis gasoline hydrogenation unit.
• One 800,000-tpy aromatic extraction unit.
• One 3-million tpy catalytic cracking unit.
• One 700,000-tpy gas fractionation unit.
• One 1.5-million tpy catalytic gasoline adsorption desulfurization (S-Zorb) unit.
• Two 2.6-million tpy continuous reforming units.
• One 3-million tpy aromatics combined plant.
• One 220,000-cu m/hr coal hydrogen production unit.
• Four 150,000-tpy sulfur recovery and tail gas treatment units.
• One sour water stripping unit.
• One solvent regeneration unit.
• Two 1.5-million tpy ethylene plants.
• Two 85-million tpy pyrolysis gasoline hydrogenation units.
• Two 550,000-tpy aromatics extraction units.
• Two 220,000-tpy butadiene extraction units.
• One 500,000-tpy ethylbenzene-styrene monomer (EB-SM) plant.
• Two 800,000-tpy ethylene glycol plants.
• Two 400,000-tpy polypropylene (PP) plants (Lummus Novolen-licensed).
• Two 400,000-tpy PP plant (separate from Novolen-licensed units).
• One 300,000-tpy PP plant (Japan Polypropylene Corp.-licensed HORIZONE process)
• One 200,000-tpy low-density polyethylene-ethylene vinyl acetate (LDPE-EVA) unit.
• One 400,000-tpy LDPE-EVA unit.
• One 300,000-tpy high-density polyethylene (HDPE) unit.