A major Sino-Kuwaiti oil refinery project, to be jointly funded by the China National Petrochemical Corporation (Sinopec) and Kuwait Petroleum Corporation (KPC), has been approved by China's industrial watchdog.

The joint venture with an estimated investment of US$5 billion in south China's Guangdong Province will become China's largest foreign-invested petrochemical project, overtaking the US$4.3 billion Nanhai Petrochemical Project, a joint venture of China National Offshore Oil Corporation and Shell Petrochemical.

The joint venture will include an oil refinery with an annual production capacity of 15 million tons and an ethylene plant with an annual capacity of 1 million tons, Shanghai Securities News quoted sources of the National Development and Reform Commission (NDRC), the industrial watchdog, as saying.

According to a memorandum of understanding (MOU) signed by Kuwait and China in late 2005, KPC will provide most investment for the project, which is scheduled to go into operation by the year 2010.

It would make Guangzhou, capital of Guangdong, a major international petrochemical production base with an annual oil refining capacity of 30 million tons and an annual output of 2 million tons of ethylene by 2010.

The MOU on the project was signed in 2005. However, the project was delayed due to Kuwaiti cabinet reshuffle.

(Xinhua News Agency July 28, 2006)