Chinese independent refiner Shandong Hongrun Group plans to further expand the capacity of its mega crude oil storage facility by 20% in 2021. Hongrun will install new storage with a capacity of 2.8 Mcm at its facility in Weifang in the northeastern part of Shandong province. According to the company, the expansion will help meet growing demand from clients. After the expansion, Hongrun’s total crude storage capacity will be 15.8 Mcm, or nearly 100 million barrels. This volume is enough to cover China’s crude oil imports for nine days.
Three-quarters of Hongrun’s existing 13 Mcm storage space are bonded tanks. Bonded storage allows refiners and traders to store oil without government import quotas because it does not require customs clearance. The 13 Mcm storage space consists of 12.2 Mcm in Weifang and 800,000 cubic metres in Qingzhou city. Hongrun’s long-term clients include international traders such as Mercuria, Vitol, and BP trading. Shanghai International Energy Exchange also uses 20 million barrels of storage space at Hongrun’s facility.
