(Xinhua)
Updated: 2007-09-07 16:29

Sinopec, China's biggest oil refiner, is to receive 33.3 billion yuan (US$4.4 billion) in consortium loans denominated in both local and foreign currencies from a lender group, company sources confirmed on Friday.

The lender group comprises 11 major Chinese banks and Sinopec Finance Company. But the sources did not reveal the names of the banks.

The money will be channeled into Fujian Refining and Petrochemical Co., Ltd., a joint venture formed in March 2007 by Sinopec's branch in east China's Fujian Province and subsidiaries of Saudi Aramco based in Saudi Arabia and ExxonMobile from the United States.

Of the total, 30 billion yuan will be used for the joint venture's oil refining and petrochemicals production, with a term of 20 years, and the remaining 3.3 billion yuan will be used for the venture's marketing operations, with a term of 15 years.

Sinopec's Fujian operations hold 50 percent of the joint venture, Saudi Aramco has a 25 percent stake and ExxonMobile, the remaining 25 percent.

The project involves expansion of the existing production facilities in Sinopec's Fujian operations and building new petrochemical equipment.

The sources said the company was "one hundred percent sure that the project will be lucrative."

Chinese commercial banks have been eying promising petrochemical projects with low risks.

Prior to the Sinopec project, CNOOC, China's top offshore oil producer, announced its petrochemical project in Huizhou, south China's Guangdong Province, with the Netherlands-based Royal Shell as a major shareholder, had acquired 22.28 billion yuan in loans. Lenders included the Industrial and Commercial Bank of China, Bank of China, China Construction Bank and Bank of Communication.