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Reuters: UPDATE 1-Shell expects China naphtha cracker to run at full

Mon Oct 29, 2007 3:16am GMT 

BEIJING, Oct 29 (Reuters) – Royal Dutch Shell (RDSa.L: Quote, Profile, Research) expects its Chinese naphtha cracker to meet or surpass its design annual capacity of 800,000 tonnes this year and next, a top executive said on Monday.

The cracker in southern Guangdong province operated at 94 percent of capacity in the first nine months of this year, up from 85 percent last year, Rob Routs, Shell Group Executive Director Downstream told a group of reporters.

“Annual production this year will meet design capacity if not more,” Routs said. “Next year they promised me it will be at the same level.”

The cracker, built in partnership with China National Offshore Oil Company (CNOOC) (0883.HK: Quote, Profile, Research)(CEO.N: Quote, Profile, Research), is Shell’s single largest energy investment in China. The plant started operation in late 2005.

When asked whether record crude prices of above $92 a barrel were affecting global fuel demand, Routs said: “We are not seeing it right now, the only place we are seeing it is in Europe and I’m not sure if that’s price related or environmentally related.”

© Reuters2007All rights reserved.

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