China appears likely to add Norway into the list of its regular crude oil suppliers in 2020, with the country’s independent refineries especially finding North Sea’s new Johan Sverdrup crude attractive for its competitive price and familiar specification.
“We have run multiple tests and found the grade acceptable. Its specification is not bad, which is similar to [Brazilian] Lula,” a source at an independent refinery based in Shandong told S&G Global Platts.
China received its first delivery from the recently launched giant Johan Sverdrup oil field earlier in December 2019 via one of state-run Sinopec’s refineries.
Unipec, the trading arm of Sinopec, bought Johan Sverdrup crude carried by a Liberia-flagged VLCC ship Orpheas for December delivery through its subsidiary Maoming Petrochemical, in Guangdong province, Southern China, a company source with direct knowledge of the matter told Platts.
The cargo arrived at Shuidong port in Maoming city on 3rd December and was discharged on 8th December, according to data from cFlow, Platts trade-flow software.
Sinopec’s 18 million mt/year Maoming Petrochemical plant often conducts test runs of new crude oil grades.
In addition, latest move by OPEC+ — a coalition of OPEC and other oil producers — toward deeper production cuts will likely leave more room for some Chinese refiners to diversify supply sources away from the Middle East with Norway expected to play a key role as a major alternative crude supplier next year, industry and market participants said.