Construction at the Xinhai Chemical Site in Cangzhou, north China, shows how independent refiners in the country, Iran's biggest oil customers, maintain their business despite being on the growing Western blacklists aimed to curtail oil revenues for governments such as Tehran and Moscow, a report by Reuters said Monday as cited by "energynews" website.
State media reported that Hebei Xinhai Holdings Group, the parent company, announced a plan in early last year to convert the refiner into a producer of chemicals. The plan was worth 50 billion yuan.
A person with first-hand knowledge of the project said that half of this investment will be used for the first phase, which is scheduled to be completed by the end of 2026. The source declined to identify themselves due to the sensitive nature of the subject.
The U.S. Treasury designated Xinhai Chemical (the unit that operates a refinery with a capacity of 120,000 barrels per day) and several Chinese oil terminal operators in May for purchasing hundreds of millions of dollars' worth of Iranian crude oil as part of efforts by President Donald Trump’s administration to press Tehran to curtail its nuclear activities.
The initial sanctions caused disruptions to Xinhai Chemical (the main business unit of Xinhai Holdings), including the suspension of state banks' services.
According to a source familiar with the expansion, and another person who was also aware of it, the refinery found a way around the restrictions by using entities that were separate from the blacklisted company and continued to import Iranian oil.
One of the employees said, "The company recovered from its initial, short disruptions."
MNA
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