DUBAI - Kuwait and China signed Monday memorandum of understandings to build a $9 billion joint venture refinery and petrochemical complex in the Asian state with Chinese refiner Sinopec Corp., the state-run Kuwait News Agency reported.State-run Kuwait Petroleum Corp and Sinopec Corp (SNP) will build a 300,000-barrel-a-day refinery and a petrochemical complex that will produce one million tons a year of ethylene, the agency reported late Monday.
Kuwait is expected to receive the final go-ahead for the project from the Chinese authorities in the first quarter of 2010, the agency said.
Kuwait will supply 100% of the crude for the project in China's southern Zhanjiang city, which is expected to be in operation between 2013 and 2014, the agency said.
Despite an initial agreement back in 2005, the refinery project hasn't yet received an official go-ahead from Beijing.
One obstacle has been the completion and approval of an environmental impact assessment, as its location close to major population centers has prompted objections from environmentalists.
Kuwait Petroleum Corp. and Sinopec, plan to choose international partners for the joint venture refinery by March 2010, Hussain Esmaiel, president of state-run Kuwait Petroleum International said in September.
European oil company Royal Dutch/Shell and U.S.-based Dow Chemical Co are still considered candidates, while KPI has recently launched initial talks with the U.K.'s BP, Esmaiel said in September.