Work on a long-delayed Sino-Russian oil refinery is expected to start in June in Tianjin, according to an industry insider.

Qin Yonghe, general manager of the China National Petroleum Corp Bohai Drilling Engineering Co, said government officials of Tianjin lobbied in Beijing in December for the project to be started.

But Qin also said some issues, including pricing, remain to be settled before the project can move forward.

Qin was commenting on the sidelines of the ongoing annual session of Tianjin Municipal People's Congress, the local legislature.

The Tianjin project, with a total investment of 36.6 million yuan ($5.8 million), was originally due for completion by 2012. CNPC is taking 51 percent of the shares, while Russia's oil producer, Rosneft, takes the remaining 49 percent.

The Tianjin government has said most of the crude oil to be processed in Tianjin will come from Russia, and annual revenue from this is expected to reach 62.2 billion yuan.

In September 2010, Vice-Premier Wang Qishan and Rosneft chief Igor Sechin laid the cornerstone for the refinery, expecting the joint venture to reach an annual capacity of 13 million tons and unleash more opportunities in the future. Since then, overall progress has been slow.

Duan Liangwei, general manager of CNPC's branch office in Dagang, Tianjin, where the refinery is being built, said talks are being held between the two sides to settle differences, but he declined to say when work can start.

Xia Yishan, an expert on global energy with the China Institutes of Contemporary International Relations, told China Energy News that energy cooperation between China and Russia is not working out as many had hoped, and last year the two sides made scant progress.

The two nations agreed an oil-for-loans plan in 2009, with China saying it will provide $25 billion in loans in exchange for 15 million tons of crude oil from Russia. Since then, annual imports of crude from Russia, which comprise about 7 percent of China's annual energy imports, have remained stagnant, Xia said.

China depends on imports for nearly 60 percent of its petroleum, according to a report on the international energy security environment published by the Chinese Academy of Social Sciences in early January.

The report urged China to promote energy cooperation with Russia, which is one of its three largest energy partners, the other two being Central Asia and the Middle East.

zhaoyinan@chinadaily.com.cn

(China Daily 02/01/2013 page16)