In a sign of closer cooperation on energy needs, Russia's biggest oil producer OAO Rosneft and China National Petroleum Corp. have made plans to build a $5 billion oil refinery in China, though gas talks between the two countries may not actually be completed until next year. The refinery will produce 260,000 barrels of oil a day, or 30 million metric tons of crude a year. The refinery had originally been planned for 200,000 daily barrels, but China's demand for energy has since upped the ante. Rosneft will hold 49 percent share in the company, with China National Patroleum holding 51 percent. Russian Deputy Prime Minister Igor Sechin met with Chinese Vice Premier Wang Qishan in the coastal city of Tianjin, announcing the deal at a foundation laying ceremony attended by the two on Sept. 21. China plans to open the refinery by 2015. Russia will supply 70 percent of the crude at market prices, while the remaining 30 percent coming from the Arab oil market. The refinery will produce motor fuels, liquified gas and petrochemicals. The two companies also plan to build a network of retail filling stations. Rosneft Chief Executive Eduard Khudainatov said “it is another step in developing cooperation between the largest oil companies of our countries.” As the world's biggest energy consumer, China is willing to make oil deals and pay highly for the goods. China signed an agreement for 300,000 barrels of oil a day in Russian crude supplies over the next 25 years in exchange for a $25 billion loan. China also agreed last month to lend Russia an additional $6 billion loan.
