Eneos Corporation, formerly known as JXTG, announced that it has agreed to continue collaborating with PetroChina International (Japan) Co., Ltd. (PCJP), a wholly owned subsidiary of China’s PetroChina International Co., Ltd.
Their joint venture called Osaka International Refining Company, Limited (OIREC), which is 51% owned by Eneos and the rest by PetroChina, will take over the 129,000 barrel-per-day (bpd) Chiba oil refinery near Tokyo.
OIREC will transfer their petroleum refinery business from the current Osaka refinery to the Chiba refinery in Japan in December 2020.
Although domestic demand is expected to continue to decline, since potential demand for petroleum products is expected to continue to increase and business opportunities are expected to improve in the Asia-Pacific region post-Covid 19. Eneos and PCJP established OIREC in October 2010 and have been jointly operating the Osaka refinery since then. But their current joint venture agreement will expire at the end of September 2020. Eneos and PCJP have been discussing further cooperation, based on the common recognition that Eneos and PCJP should maintain and continue the current strategic framework of utilising the refinery operation skills of Eneos and the product marketing expertise of PetroChina.
The Chiba refinery will process crude oil supplied by PetroChina and export refined products which will be marketed by PetroChina.
In accordance with continuing the joint venture business with PetroChina, Eneos will acquire the Osaka refinery from OIREC by way of an absorption-type company split. The Chiba refinery will be transferred from Eneos to OIREC in the same way.
Eneos will terminate the refinery operations at the 115,000 bpd Osaka refinery in October 2020 and re-purpose it into an asphalt-fueled electric power facility.