Nation’s First Oil Refinery Online for 2018

After years of uncertainty and controversy in the local petrochemical sector, Cambodia’s first oil refinery plant is expected to go online in 2018 thanks to a USD3 billion joint venture between Cambodian and Chinese firms.

The Cambodia Petrochemical Company (CPC) signed an MoU worth USD620 million in May with the Chinese National Petroleum Company (CNPC) Northeast Refining and Chemical Engineering with phase one engineering works expected to begin in October.

Located on Cambodia’s coastal zone, the refinery will be built on a 365-hectare landmass between Kampot and Preah Sihanouk province with a capacity of 5 million tons per year or about 90,000 barrels per day (bpd). But it will only produce 2 million tons per year or about 40,000 bpd during its initial operation stage before expanding to a full operation of 100,000.

Since Cambodia is not yet extracting its own oil, the plant is expected to refine imported crude oil from the Middle East until local extraction starts. The plant will be capable of refining both so-called sweet and sour crude – oil with low or high levels of sulphur respectively.

Waste from the refinery will be used to produce fertiliser, tires and other products. 85 percent of the refined oil will serve the local market with the remainder being exported overseas.

“PT Sans”;color:black\”>Speaking at the contract signing ceremony in Phnom Penh in May 2016, Oknha Hann Khieng, the managing director of the Cambodian Petrochemical Company (CPC) said it is time for Cambodia to have an oil refinery to supply the domestic market as well as for export to other countries, especially in ASEAN.

“Since we are the youngest country to have an oil refinery, the new facility will have the latest modern technology with a high standard to get a market share as an oil producer in the region,” he told the Khmer Times.

According to Oknha Hann, a number of overseas corporations have investigated the possibility for oil refinery investment in Cambodia over the years, but none of them invested in a refinery plant. In 2010, Oknha Hann Khieng partnered with a Chinese firm to register the CPC in Cambodia to allow their official cooperation to study an oil investment project in the nation.

After spending years on the procedures and issues related to this refinery investment, the Cambodian Petroleum Authority granted the investment license to the CPC on 15 June 2011 to do a feasibility study for an oil refinery plant.

The CPC fulfilled all the necessary procedures and legal requirements and subsequently received a construction permit to build an oil refinery in Sihanoukville province on 28 December 2012.

CNPC Northeast Refining and Chemical Engineering will manage and implement the procurement and build Cambodia’s first oil refinery. It is an expert in the oil and chemical industry and is a subsidiary of the Chinese-state-owned conglomerate CNPC.

CNPC is one of China’s top three oil engineering and chemical corporations. This multi-sector company was listed on the stock market in 2010 with a share value of over USD3 trillion and was ranked the 14th best financial institution among the world’s top 500 corporations.

Li Limin, chairman of CNPC Northeast Refining and Chemical Engineering, said, “This first refinery will help develop the country’s economy while the plant will be safe by following international standards and be environmentally friendly.”

Cambodian Minister of Mines and Energy H.E. Suy Sem, welcomed the refinery as it is in line with government policy to urge investment in the oil and gas sector so that the country can supply more electricity domestically at a reasonable price.

“I encourage all private sector companies to facilitate and invest in oil and gas more and more,” he said.

The refinery was first announced in Cambodia in 2011, but despite securing a USD1.67 billion loan to finance the project from the Chinese Ex-Im Bank in 2013, there has been little progress since.

Deputy Prime Minister H.E. Sok An, who is also the Chairman of Cambodia Petroleum Authority, had said previously that Cambodia’s current petroleum demand is more than 1 million tons a year, largely met with imports from Vietnam, Singapore and Thailand.

- Video Advertisement -

Related Post

Cambodia and Australia Strengthen Ties with Investment and Trade Commitment

In a significant step towards enhancing bilateral relations, Cambodia and Australia have pledged to explore new strategies for expanding investment and trade cooperation. This commitment was solidified during a meeting held on May 19, 2025, between His Excellency Hun Manet, Prime Minister of Cambodia, and Ms. Frances Adamson, Premier of South Australia. The discussions highlighted […]

Cambodia and Laos Forge Stronger Agricultural Ties to Expand Mango Exports

In a significant move to enhance agricultural trade, Cambodia and Laos have reached an agreement to boost the export of Cambodian mango products to third countries via Laos’ high-speed rail system. This announcement was made during an official visit from April 30 to May 3, 2025, where H.E. Dith Tina, Cambodia’s Minister of Agriculture, met […]

AEON Breaks Ground on USD 46 Million Shopping Mall in Vietnam

  In a strategic move amidst the global economic downturn, Japanese retail giant AEON is strengthening its presence in Vietnam with the groundbreaking of a new shopping mall. On April 19, 2025, AEON Vietnam commenced construction on the AEON HAI DUONG shopping mall in Hai Duong province, located just north of Hanoi. The project has […]

Malaysia Bets on USD 250 Million Deal to Train 10K Semiconductor Specialists to Spark Homegrown Chip Design Revolution

Malaysia has sealed a landmark USD 250 million semiconductor partnership with UK-based Arm Holdings, granting the Southeast Asian nation access to Arm’s advanced intellectual property as it aims to shift from a manufacturing-based economy to a high-value design and innovation hub in the global chip supply chain. The agreement, formally signed on 5 March 2025 […]

Cambodia’s Steel Imports Surge in Early 2025

Cambodia’s steel imports significantly rose in the first quarter of 2025, with the nation importing iron and steel valued at USD217 million. This marks a remarkable 75% increase compared to USD124 million during the same period last year. According to a report released on 10 April by the General Department of Customs and Excise, iron […]

SchneiTec Dynamic Lists Green Bond Mobilising USD 50 million for Green Energy Development

SchneiTec Dynamic Co., Ltd has listed a green bond on the Cambodia Securities Exchange (CSX), mobilising USD 50 million for its green energy development project in Cambodia. The Official Green Bond Listing Ceremony was held on 11 April 2025, at the Cambodia Securities Exchange. During the ceremony, HE Sou Socheat, a Delegate of the Government […]