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Chinese Refiner Rongsheng Buys Canadian TMX Crude Oil Cargo

Chinese refiner Rongsheng Petrochemical (002493.SZ) has acquired its first Canadian crude oil shipment through the recently expanded Trans Mountain pipeline (TMX) from TotalEnergies (TTEF.PA), according to several trade sources on Monday. The shipment, consisting of 500,000 barrels of Access Western Blend (AWB) crude, will be delivered to Rongsheng’s refinery in Zhoushan in August. AWB is a heavy and highly acidic diluted bitumen produced by Canadian Natural Resources and MEG Energy.

The purchase price was not disclosed. The TMX pipeline, which began commercial operations last month after extensive regulatory delays and construction setbacks, will transport an additional 590,000 barrels per day (bpd) from Alberta to Canada’s Pacific coast. The pipeline’s flows and loadings from the Westridge Marine Terminal are being closely watched by traders and shippers as the expansion opens up greater access for Canadian oil producers to the U.S. West Coast and Asian markets.

The first TMX shipment purchased by Chinese refiner Sinochem Corp is currently en route to China. Additionally, Sinopec (600028.SS), PetroChina (601857.SS), and India’s Reliance Industries (RELI.NS) have also bought cargoes. Canadian oil sellers are looking to increase exports to Asia, where demand is growing and Asian refiners often pay higher premiums. However, some Asian refiners face challenges processing certain Canadian crude grades due to their high sulphur and acid content, traders noted.

In addition to AWB, TotalEnergies has offered Cold Lake crude from the pipeline to Asian buyers. Separately, Rongsheng purchased 2 million barrels of Abu Dhabi Upper Zakum crude from Aramco Trading at 60 cents per barrel above July Dubai quotes before freight charges in the same tender. The Chinese refiner also acquired 2 million barrels of West African crude, including Congolese Djeno and Angolan Mostarda grades, at $2.50-$3 per barrel above July dated Brent on a cost and freight basis from Unipec, the sources added.

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