China's state-controlled Qingdao Port and global trading firm Mercuria have applied for their crude storage facility in Shandong province to be included as a physical delivery location for the Shanghai International Energy Exchange (INE) crude futures contract.
The tank at Dongjiakou has total storage capacity of 2.46mn m³ (15.5mn bl). Qingdao Port has applied to list 5.04mn bl of working capacity on the INE.
Qingdao Port has a 71pc stake in the crude storage facility and Mercuria owns 17.5pc, making it the first listed INE delivery point part-owned by a non-Chinese firm, assuming the listing is approved. Qingdao Port has issued a letter of guarantee to take responsibility for the tank, as required by INE.
INE has 16.55mn m³ of storage capacity registered under its crude futures contract. The current amount of activated capacity, which can be adjusted based on market demands, is 11.9mn m³.
The INE struggled with a shortage of physical delivery capacity during market turmoil in April, putting it under pressure to lease more space from tank farm owners.
| Shanghai INE physical delivery tanks | |||
| Operator | Site | Delivery capacity | Activated capacity |
| (mn m³) | (mn bl) | ||
| Sinopec | Caofeidian, Hebei | 1.0 | 2.0 |
| Sinopec | Rizhao, Shandong | 1.2 | 5.2 |
| Sinopec | Zhoushan, Zhejiang | 0.8 | 3.5 |
| Sinopec | Zhanjiang, Guangdong | 0.9 | 4.16 |
| Sinopec | Yangpu, Hainan | 1.0 | 3.0 |
| PetroChina | Ningbo, Zhejiang | 0.4 | 2.32 |
| PetroChina | Zhanjiang, Guangdong | 0.7 | 3.11 |
| Sinochem | Zhoushan, Zhejiang | 1.0 | 2.1 |
| PetroChina | Dalian, Liaoning | 1.45 | 8.3 |
| PetroChina | Dalian, Liaoning | 1.8 | 10.8 |
| PetroChina | Qinzhou, Guangxi | 0.2 | 1.2 |
| Qingdao Port/Sinopec | Dongjiakou, Shandong | 0.4 | 2.39 |
| Shenggang/PetroChina | Yangshan, Shanghai | 0.3 | 1.26 |
| Dalian Port/Norinco | Dalian, Liaoning | 0.4 | 5.4 |
| Sinochem Hongrun | Weifang, Shandong | 5.0 | 18.0 |
| Total | 16.55 | 72.74 | |
| Source: INE | |||
