Sinopec-affiliated Shanghai Petrochemical has issued a tender for the first construction package (EPC, Engineering, Procurement and Construction) of a comprehensive technical revamp and upgrade project that will expand ethylene production capacity at its existing Jinshan District site in Shanghai from 700,000 to 1.2 million tonnes per year. The tender is reported to close on October 8, 2026, with a construction period of 822 days.
The project is centered on decommissioning the existing 700,000 tonne-per-year ethylene unit and building a new 1.2 million tonne-per-year ethylene production line at the same site. Alongside the new ethylene unit, the project is reported to include eight associated chemical facilities: a 400,000 tonne-per-year FDPE unit (convertible between low-density polyethylene and EVA production), butadiene extraction, pyrolysis gasoline hydrogenation, aromatics extraction, vinyl acetate, and a carbonate ester unit for electric vehicle battery electrolytes. The refinery segment is reported to maintain its existing 14 million tonne-per-year crude processing capacity unchanged.
The estimated value of the first EPC package now out for tender is approximately RMB 5.634 billion, with the project’s total investment estimated at approximately RMB 21.307 billion. The new ethylene capacity is 1.2 million tonnes per year, an increase of roughly 71% from the existing 700,000 tonnes per year, while the new FDPE unit will have a capacity of 400,000 tonnes per year. Crude processing capacity is confirmed to remain unchanged at 14 million tonnes per year. The construction period is confirmed at 822 days.
The project is seen as aligning with China’s industrial policy of upgrading and scaling up aging petrochemical facilities while shifting from lower-value commodity products toward higher-value specialty chemicals. It is also notable that Shanghai Petrochemical, a flagship state-owned petrochemical complex in the East China region, chose to restructure its facilities within its existing site footprint rather than developing a new location.
This revamp project is seen as a clear example, at one of China’s flagship state-owned complexes, of the broader “old-capacity closure, new-capacity scale-up” trend that has characterized China’s petrochemical industry in recent years. Ethylene production capacity in China has expanded rapidly in recent years amid a wave of new cracker startups, raising oversupply concerns; against this backdrop, Shanghai Petrochemical’s decision to decommission its smaller existing unit in favor of a larger-scale replacement can be read as a strategy focused on improving efficiency and cost competitiveness rather than simply adding capacity. The inclusion of a carbonate ester unit for EV battery electrolytes also reflects a strengthening linkage between China’s battery supply chain and its petrochemical industry. As the EPC tender proceeds sequentially starting with the first package, sizable contract opportunities are expected to follow for design, construction and equipment suppliers, making the progression of subsequent tenders for this large-scale Chinese petrochemical revamp project worth monitoring for domestic and international plant equipment suppliers alike.
The result of the first EPC package tender closing on October 8, 2026, and the winning contractor, are the first points to confirm. The schedule and scope of subsequent tender packages beyond the first are also worth watching. In addition, whether the project’s final mechanical completion and commercial startup targets will be formalized, and whether further technology and licensor details for each of the eight associated chemical units will be disclosed, both warrant further confirmation.