New Trends in Global Refining and Chemical Integration Development

　　Integrated refining and chemical operations have evolved from a simple, fragmented form of integration into a comprehensive, tightly coordinated system where refining and petrochemical facilities mutually supply materials, share energy resources and utility services. This integrated approach has become a strategic choice for both domestic and international refining companies—enabling them to optimize resource allocation, reduce investment and production costs, enhance product value-added, accelerate transformation and upgrading, and ultimately boost profitability.

　　As the global energy landscape undergoes a gradual transformation, the growth rate of oil product demand is slowing down, while the demand for petrochemical products is accelerating. Consequently, integrated refining and chemical operations have emerged as a critical strategic approach for the petrochemical industry. Initially, refining-chemical integration was a simple, fragmented model—where an existing refinery supplied naphtha feedstock to downstream petrochemical plants producing ethylene and aromatics. Over time, however, this concept has evolved into a more comprehensive and tightly integrated system. Today, it involves mutual supply of materials between refining and petrochemical facilities, as well as shared energy resources and utility systems. This integrated approach not only enhances the efficient utilization of petroleum resources but also helps reduce investment and production costs while adapting swiftly to shifting demands for both oil products and petrochemicals. Compared to refineries of similar scale, integrated refining-chemical enterprises can achieve a 25% increase in product added value, save over 10% on construction investments, and cut energy consumption by approximately 15%. Under the new market conditions, refining-chemical integration is now showcasing a range of emerging trends and developments.

　　Integrated refining and chemical production are increasingly closely aligned with large-scale, base-level development.

　　The global refining and petrochemical industry has established several world-class refining and chemical hubs, including the U.S. Gulf Coast, Japan’s Tokyo Bay area, Singapore’s Jurong Island, and Saudi Arabia’s Jubail and Yanbu Petrochemical Industrial Parks. Among these, the U.S. Gulf Coast stands out as the largest refining and petrochemical complex in the world, with an annual refining capacity of 460 million tons—accounting for 52% of the total refining capacity in the United States. It also produces 95% of the country’s domestic ethylene output, boasting a combined ethylene production capacity of 27 million tons per year. In China, the Bohai Rim region, the Hangzhou Bay area, and the Daya Bay Petrochemical Zone in Huizhou have become home to a number of large-scale refining and petrochemical enterprises. Notably, the Hangzhou Bay Petrochemical Cluster hosts several major domestic oil refineries and petrochemical companies, collectively generating an annual refining capacity of 81 million tons and an ethylene production capacity of 3.955 million tons—representing 10.8% and 19.1% of China’s national refining and ethylene capacities, respectively. Meanwhile, the Daya Bay Petrochemical Zone in Huizhou has attracted numerous large domestic and international integrated refining and petrochemical giants. By 2020, the region is expected to reach annual refining and ethylene production capacities of 40 million tons and 5 million tons, respectively.

　　In its industrial layout planning, China’s government also mandates that all newly built refining and petrochemical projects must be located within designated industrial bases. During the 13th Five-Year Plan period, seven major petrochemical industry bases were newly planned across the country: Dalian Changxing Island, Shanghai Caojing, Guangdong Huizhou, Fujian Gulei, Hebei Caofeidian, Jiangsu Lianyungang, and Zhejiang Ningbo. In principle, no further sites will be added beyond these existing bases. In recent years, both newly established and planned refining and petrochemical enterprises have been strategically positioned within these key bases—for instance, Zhejiang Petrochemical is situated at the Yushan Island base in Ningbo, Zhejiang, while Hengli Petrochemical is located at the Changxing Island base in Dalian.

　　"Integrated refining and chemical development" will become the new normal for integrated refining and chemical operations.

　　In recent years, on the one hand, global refining capacity growth has begun to stabilize—or even stagnate—while some regions, including Asia-Pacific countries like China, are already experiencing overcapacity. On the other hand, thanks to the sustained economic growth and rising living standards in developing nations, the petrochemical industry still holds significant room for expansion. In particular, there is a growing shortage of basic organic chemical feedstocks such as ethylene, propylene, and aromatics, while demand continues to surge for chemical products, especially high-end specialty chemicals. Refining and chemical enterprises must shift from mass-producing finished oil products and bulk petrochemical feedstocks toward developing more high-value-added oil products and premium-quality petrochemical raw materials, thereby unlocking greater potential for the industry's continued growth. Meanwhile, the Chinese government has mandated that new refinery projects be built with integrated refining-and-chemicals facilities. It has also called for strict control over additional refining capacity, accelerated phasing out of outdated and inefficient refining assets, and vigorous support for companies investing in cutting-edge chemical materials and specialized chemical products.

　　From a global perspective, the vast majority of refining and petrochemical projects commissioned or newly built in recent years are large-scale integrated refining-and-chemical complexes, with very few standalone oil-refining facilities. For instance, Malaysia’s 15-million-ton-per-year RAPID integrated refining-and-chemical complex, which began operations at the end of January 2019, boasts a petrochemical production capacity of up to 3.6 million tons per year for products such as polyolefins and synthetic rubber. Meanwhile, Hengli Petrochemical’s 20-million-ton-per-year facility, fully operational since March 2019, is capable of converting 70% of its crude oil into high-end aromatic-based petrochemical products, while the remaining portion is used to produce by-products like gasoline and diesel.

　　The integrated refining and chemical model is expanding toward greater diversification.

　　Traditionally, the integrated refining and petrochemical model has primarily revolved around refineries expanding from producing gasoline and diesel to also manufacturing ethylene and polyolefin products—a refining-ethylene integration approach. Since the 1990s, especially in recent years, with rising aromatics demand, coupled with refineries' growing need for hydrogen and their increasing interest in combined heat, power, or steam-and-power generation, coupled with the current and projected rise in electricity consumption as a secondary energy source, refining-petrochemical integration has transcended the confines of traditional refineries, now encompassing entire chemical plants. As a result, the level of integration has significantly intensified, giving rise to diverse integrated models such as refining-aromatics integration, refining-ethylene-aromatics integration, and refining-power-steam integration. For instance, the ongoing 40-million-ton-per-year Zhejiang Petrochemical project exemplifies the refining-ethylene-aromatics integration model, featuring a refining capacity of 40 million tons/year, an ethylene production capacity of 2.8 million tons/year, and an aromatics output reaching up to 10.4 million tons/year. Meanwhile, ExxonMobil has pioneered and implemented IGCC (Integrated Gasification Combined Cycle) technology for integrated steam-and-power generation. In China, Fujian Refining & Chemical has adopted this technology to build the country's first multi-product IGCC facility capable of supplying hydrogen, steam, and electricity simultaneously. Utilizing de-oiled asphalt produced by its solvent脱沥青 unit as feedstock, the plant generates hydrogen, ultra-high-pressure steam, and electricity, while also co-producing oxygen and nitrogen. This innovative setup not only meets 100% of the electricity and steam needs but also provides 40% of the hydrogen required for the company's massive 12-million-ton-per-year refining-petrochemical integration project, delivering impressive economic and social benefits.

　　Technological advancements drive the deepening integration of refining and chemical industries.

　　As refining and chemical integration deepens, the related technologies have also advanced. Traditional refining and chemical integration techniques are once again drawing industry attention—for instance, catalytic cracking technologies that maximize low-carbon olefin production, catalytic reforming technologies aimed at boosting aromatic hydrocarbon yields, and hydrocracking processes designed to generate high-quality ethylene feedstock. These advancements have led to notable progress in areas such as developing innovative catalysts, reducing costs, and optimizing operational procedures. For example, hydrocracking is increasingly becoming a core technology in integrated refining and chemical operations. By adopting new catalysts and fine-tuning process flows or conditions, hydrocracking is now widely employed to produce large quantities of naphtha or hydrotreated residual oil. Light naphtha and hydrotreated residual oil are particularly valuable as ethylene feedstocks, while heavy naphtha serves as an ideal raw material for aromatics production. More significantly, cutting-edge technologies have emerged, including direct crude oil cracking to produce ethylene and direct conversion of natural gas into olefins/aromatics. Companies like ExxonMobil, Saudi Aramco, and SABIC

　　Sinopec has developed a technology that directly cracks crude oil to produce olefins, bypassing major refining processes such as atmospheric and vacuum distillation and catalytic cracking. This streamlined approach not only simplifies the production流程 but also reduces capital investment, with the ultimate goal of maximizing chemical output—yielding abundant olefin and aromatic feedstocks. The chemical conversion rate can reach 50% to 70%. ExxonMobil has already built the world’s first commercial-scale direct crude-oil-to-ethylene unit in Singapore, capable of producing 1 million tons of ethylene annually at a cost lower than $50 per barrel for cracking feedstock. Currently, the company is planning to deploy this technology in Huizhou, China, where it aims to construct a massive 1.2-million-ton-per-year direct crude-oil-to-ethylene plant. Meanwhile, Saudi Aramco and Saudi Basic Industries Corporation (SABIC) are jointly developing a pioneering project in Yanbu, Saudi Arabia, which will annually produce up to 14 million tons of chemicals, boasting a remarkable chemical conversion rate of 70%. China National Petroleum Corporation (CNPC), SABIC, and the Dalian Institute of Chemical Physics, Chinese Academy of Sciences, are collaborating on an innovative technology that enables the direct conversion of natural gas into olefins and aromatics. Compared to conventional natural gas-to-chemicals routes, this cutting-edge process eliminates the energy-intensive syngas preparation step, significantly shortening the overall production pathway. Moreover, the reaction itself achieves zero carbon dioxide emissions, while maintaining a near-perfect carbon atom utilization efficiency of 100%. If successfully developed, this breakthrough technology could further propel the integration of refining and petrochemical industries, opening new frontiers in areas like natural gas and coal chemical processing.

　　Under the new circumstances, integrated refining and chemical operations have significantly expanded their functional capabilities, showcasing innovative models and emerging development trends. This approach has become a strategic choice for both domestic and international companies—enabling them to optimize resource allocation, reduce investment and production costs, enhance product value-added, accelerate transformation and upgrading, and ultimately boost profitability. As a result, integrated refining and chemical operations are poised to play an even greater role in driving the sustainable growth of the industry.