In recent one month, the LPG supply in Yunnan and Guizhou was tight. In Yunnan, as the deep-processing unit was put into operation, PetroChina Yunnan Petrochemical arranged most resources for self-use, and the spot supply of civil-use gas was relatively tight.
The oil refining project at PetroChina Yunnan Petrochemical was put into operation in H1 August, and the daily supply of LPG climbed over 1,000mt. Besides, these LPG resources were supplied to Yunnan, Guizhou, Sichuan and Chongqing, and the city distributions and retailers in these four provinces mainly consumed resources from PetroChina Yunnan Petrochemical.
From late August to early September, the refineries in Yunnan sold gases with and without unsaturated hydrocarbon. However, the sales volume of gases with and without unsaturated hydrocarbon had been cut obviously since mid-September. It was tough for the traders in Yunnan to purchase gases with and without unsaturated hydrocarbon, and the resources which supplied to city distributions were unstable. SCI learned that these all because that the first alkylated unit in Yunnan was put into operation.
The alkylated unit with the capacity of 260kt/a at Yunnan Yuntianhua Group had been successfully tested in early September. Relied on PetroChina Yunnan Petrochemical, the feedstock supply and the product sales of this alkylated unit were effectively guaranteed. The feed gas from PetroChina Yunnan Petrochemical was preferentially supplied to the alkylated unit at Yunnan Yuntianhua Group, and the others were arranged for external sales. Calculated by the full load of alkylated unit at Yunnan Yuntianhua Group, it had to consume C4R2 for about 890mt per day. In other words, more than a half resources at PetroChina Yunnan Petrochemical had to offer to Yunnan Yuntianhua Group preferentially. Thus, the sales volume at PetroChina Yunnan Petrochemical dropped somewhat. Although the alkylated unit had not run with a full load, calculated by the operating rate of 70%, it had to consume more than 600mt resources per day.
Sources said that the resources from PetroChina Yunnan Petrochemical and Yunnan Yuntianhua Group were unstable, as the units were at the initial stage. The daily sales volume at PetroChina Yunnan Petrochemical hovered at 600–1,000mt. As the local resources had super quality and competitive price, most market participants purchased goods in Yunnan. Meanwhile, in order to fit in the market, some enterprises had to adjust their sales volume due to the insufficient resources.
Along with the debugging progresses in PetroChina Yunnan Petrochemical and Yunnan Yuntianhua group, SCI predicts that the sales volume at PetroChina Yunnan Petrochemical will be stable. Excluding the feedstock for the alkylated unit, Yunnan Yuntianhua Group will sell the n-butane to PetroChina Yunnan Petrochemical. In the future, the average daily supply from PetroChina Yunnan Petrochemical will hover at 800–1,000mt.
In terms of the price, the LPG price in Yunnan was at a quite low level. However, as the sales volume decreased, the price trend in Yunnan remained firm. In recent one week, influenced by the price decline in Northwest China and Guangxi, the LPG price in Chengdu reduced. Meanwhile, supported by the insufficient resources, the LPG prices in Guizhou hovered at highs. In Yunnan, the LPG prices inched up. As the demand for LPG will become poor, SCI predicts that the LPG prices in Yunnan and Guizhou may inch down.