Construction and Market Impact Analysis of Zhongshagu Lei Ethylene Project

Project construction status and production schedule

overview of construction progress

at present, the Zhongsha Gulei Ethylene Project in Gulei Development Zone in Zhangzhou, Fujian Province has completed 90.5 percent of the overall progress, including 89.8 percent of the process equipment, 92.4 percent of the public works, and the civil frame structure has been basically completed. The focus of construction has shifted to the final works such as steel structure installation, pipeline laying and equipment in place. The packaging and warehouse unit of the polypropylene plant has been mechanically completed and has entered the production preparation stage, and the 35kV substation supporting the sewage treatment system has been successfully powered, providing power guarantee for subsequent commissioning and operation.

key time node

according to the seventh high-level meeting held on November 20, the project has been locked in March 31, 2026 as the main device mechanical completion (MC) hard target. The cumulative safe working hours of the project have exceeded 40 million hours, and the quality PQI index has reached 91.3 per cent. At present, in the critical period of project completion and production preparation handover, the management has established the strategy of "double-line and orderly transition", that is, while completing the construction completion, gradually shift the focus to the joint commissioning (CSU) preparation. The stability of the construction team before and after the Spring Festival is regarded as an important factor to ensure the construction period.

Capacity Scale and Industrial Chain Layout

project Investment and Core Capacity

the total investment of the project is about 44.8 billion yuan (about 6.3 billion US dollars). The core is to build a world-class ethylene cracking plant with a design capacity of 1.5 million tons/year and a maximum capacity of 1.8 million tons/year, which is among the top ethylene plants in China.

Complete industrial chain configuration

ethylene downstream product line: the ethylene oxide/ethylene glycol combined unit is 10/1 million tons/year, providing raw materials for the polyester fiber industry; polyethylene products include 400000 tons/year of high-density polyethylene, 600000 tons/year of metallocene linear low-density polyethylene/high-density polyethylene dual-function unit, and 50000 tons/year of 1-hexene unit as comonomer supply.

Propylene downstream product line: the total production capacity of the two polypropylene units is 950000 tons/year (400000 tons/year anti-flush/random copolymerization +550000 tons/year homopolymerization/random copolymerization). The high value-added product chain includes phenol acetone plant 25/150000 tons/year, bisphenol A plant 270000 tons/year and polycarbonate plant 290000 tons/year, forming a complete value chain from basic chemical raw materials to engineering plastics.

Comprehensive utilization of by-products: the pyrolysis gasoline hydrogenation and styrene extraction unit is 910000 tons/year, the butadiene extraction unit is 220000 tons/year, the 1-butene unit is 56000 tons/year and the aromatic extraction unit is 570000 tons/year, realizing the high-value utilization of C4, C5 and aromatic components.

Market Impact Assessment

changes in regional supply patterns

after the project is put into operation, it will significantly change the supply pattern of petrochemical products in South China. The combined new production capacity of polyethylene and polypropylene is about 2 million tons/year, and the new production capacity of ethylene glycol is 1 million tons/year. These production capacity will directly affect the supply and demand balance in South China and the entire Chinese market. For overseas traders, China's import demand may be reduced, especially in the polyolefin and ethylene glycol category.

Impact in the field of engineering plastics

the new production capacity of 290000 tons/year of polycarbonate deserves special attention, which will further enhance China's self-sufficiency in the field of engineering plastics, and may cause competitive pressure on PC exports to the Chinese market in Japan, South Korea and Southeast Asia.

Suggested Concerns

chemical traders should closely follow the progress of the project's commissioning in the first quarter of 2026 and assess its impact on the regional price system for products such as polyolefins, glycols and engineering plastics. The integrated configuration of the project and the advantages of comprehensive utilization of by-products will make it have strong cost competitiveness and may reshape the distribution pattern of chemical products in South China.