China’s Sinochem Hongrun sells first fuel export

BEIJING, April 20 (Reuters) -- Teapot refiner Sinochem Hongrun Petrochemical has sold a cargo of gasoline to an overseas buyer for its first product exports, three sources with direct knowledge of the deal said, as China's independent producers join state firms to export surplus fuel.

Independent plants, nicknamed "teapots" due to their relatively small processing capacity, were granted quotas to export refined fuel for the first time early this year, after first winning the rights in 2015 to import crude oil.

Sinochem Hongrun, partly owned by state-run Sinochem Corp., sold a 35,000-ton cargo of 92-octane gasoline to trading house Trafigura, the sources said, and it is being loaded on Wednesday at Laizhou port in Shandong province.

A Singapore-based public relations company that represents Trafigura did not immediately respond to a query about the deal.

Hongrun is the second teapot plant to export gasoline. Dongming Petrochemical Corp., the country's largest teapot plant, was the first with an export cargo early this year.

Armed with quotas that could make up a fifth of total Chinese crude imports this year, the nation's independent refineries are among the brightest spots in the global crude oil market as they ramped up throughput, at the same time adding to China's swelling fuel exports.

While the teapots' robust crude purchases are causing severe tanker delays at Shandong ports as large import terminal and storage capacities lag behind the demand, their fuel exports have been hampered by scant pipeline and berthing facilities.

Without a pipeline to pump gasoline to the export berth, it took Hongrun almost two months to load a ship with 35,000 tons of the fuel by 30-ton trucks, said a source at Hongrun.