Another super oil and gas engineering service order was won by this Chinese company.
China national chemical engineering co., ltd. recently signed a $5 billion, four-year cooperation agreement for Russia's OilGasHolding Paykha oil and gas field.
It is worth mentioning that the amount of us $5 billion or 34.5 billion yuan in a single agreement is nearly equal to the total amount of new contracts signed by the top three oil companies in 2018.It is rare for a Chinese company to sign such a large-scale overseas engineering service agreement.
Meanwhile, QCC will be the first Chinese company to enter the arctic oil and gas project as EPC general contractor, opening a corridor for Chinese oil and gas engineering service companies to enter the arctic oil and gas project.
Chinese companies pushing into the arctic
Located in the KrasnoyarskiyKray region of Russia's Taymyr peninsula, the paya field is one of the richest oil and gas fields in the arctic region.
Up to now, the estimated oil reserves of the payaha oil and gas field are 420 million tons, and the oil reserves may be as high as 2 billion tons. The opening of this large-scale oil project has generated tens of billions of dollars of oil and gas business opportunities, attracting the attention of global oil companies.
This time, Chinese oil companies are once again gaining the upper hand in arctic projects among a group of international oil majors.
On June 6, as an engineering service enterprise, qihua construction, a wholly-owned subsidiary of China chemical engineering group co., LTD. (hereinafter referred to as "China chemistry"), won the enviable EPC project agreement on the payaha oil and gas field project.
According to the cooperation agreement, the project involves 5 billion us dollars. As the EPC general contractor of the payaha oil and gas field project, qipcc's work scope mainly includes the construction of 6 oil field crude oil processing equipment, crude oil loading terminal with an annual throughput of 50 million tons, more than 410 kilometers of crude oil pressure pipeline, 750 mw power station and tank area.
The paiaha oil and gas field project service agreement obtained by QCC is a further upgrade from dimension, capital and service form compared with the previous yamal project involving Chinese oil and gas engineering service enterprises.
Looking back on 2014, a total of 7 Chinese enterprises, mainly CNPC and cnooc, subcontracted 120 modules of yamal project in the form of subcontractors, which was the first time for China to undertake the construction of LNG core process module.
Despite doubts, time has proven that Chinese oil and gas engineering service companies' entry into the arctic yamal project has brought real money and brand influence recognized by Chinese enterprises in the international market.
Five years from now, instead of participating as a subcontractor, 7chemical construction will appear as EPC general contractor in the payaha oil and gas field project in the arctic.
Chinese chemistry is booming
In fact, the day before the agreement on the payaha project was signed, Chinese chemical was not idle.
On June 5, under the joint witness of the heads of state of China and Russia, China national chemical successfully signed a contract for the annual production of 1.8 million tons of methanol of Russia's nakhodka fertilizer company, with a total contract amount of nearly 1.5 billion us dollars.
As one of the largest single-series methanol projects in the world, the annual production of 1.8 million tons of methanol by nakhodeka chemical fertilizer company shows the foundation of China chemistry as the top engineering construction company in the global oil and gas industry.
Success is no accident. Two record oil deals in two days.
China national chemical corporation was the first Chinese enterprise to undertake overseas contracting projects. In the 1990s, it entered the Russian market and carried out in-depth cooperation with many large oil and gas companies such as rosneft, gazprom, lukoil and sibir.
For example, the TAF fertilizer project of tatarstan republic of Russia, which was signed by China's chemical industry in 2010, is the world's largest fertilizer co-production plant based on natural gas.
On closer inspection, the success of the TAF fertiliser project is only a microcosm of China's continuing push into the international market.
On April 25 this year, China national chemical corporation successfully signed an EPC contract of 450 million us dollars for the nitrogeno chemical fertilizer project in Russia. This chemical fertilizer project is one of the major key projects in the tula industrial zone in Russia, and China national chemical corporation has become the first enterprise to participate in the construction of the project under the EPC general contract mode in this industrial zone.
Currently, the contract value of the projects under construction in Russia is 4.2 billion us dollars, and the contract value of the tracking projects is nearly 20 billion us dollars.
New development opportunities for oil and gas engineering service enterprises
The overseas forays by state-owned companies such as three barrels of oil and China chemical are creating new project opportunities for domestic oil and gas engineering service companies, from yamal to payaha.
Most directly, as the EPC general contractor of the payaha oil and gas field project, qihua construction will bring considerable subcontracting orders to domestic oil and gas engineering service enterprises.
Meanwhile, the cooperation and development of international high-end oil projects will bring potential international business to domestic enterprises.
On June 7, CNPC and cnooc signed an equity purchase agreement with novatek for the LNG2 project in the arctic. According to the agreement, CNPC and cnooc will purchase 10% of the shares of LNG2 project in the arctic respectively.
It is worth noting that as an extension of yamal project, LNG2 arctic project is estimated to cost 25.5 billion us dollars. The direct investment of petrochina and cnooc will bring huge business opportunities to Chinese domestic enterprises, and there is a precedent to follow.