Re Joint Venture

BP PLC
10 December 2001



December 10, 2001


                 BP, SINOPEC AND SHANGHAI PETROCHEMICAL FORM
                  WORLD-SCALE CHINESE CHEMICAL JOINT VENTURE

BP, Sinopec and Shanghai Petrochemical Corporation (SPC) today held a
celebratory reception in Beijing to mark the formation of the joint venture
company that will build a $2.7 billion ethylene cracker and chemical
derivatives complex near Shanghai.


Shanghai Secco Petrochemical Company Ltd (SECCO) will build the world-scale
complex, expected to begin operation in 2005, at Shanghai Chemical Industry
Park, Caojing, near Shanghai. The formation of  the company - owned by BP (50
per cent), Sinopec Corporation (30 per cent) and SPC (20 per cent) - follows
the final approval for the joint venture by the Chinese authorities with the
granting of a business licence by the Administration of Industry and Commerce.


Speaking at the celebration in the Great Hall of the People, Byron Grote, BP's
Managing Director with responsibility for Asia and Chief Executive of BP's
chemicals businesses, said: 'SECCO is the strongest confirmation of BP's
belief in China's future. It is larger than any other investment we have made
in the country, one of the largest-ever foreign investments in China and a
long-term commitment which will create enduring value and mutual advantage.'


Wang Jiming, President of Sinopec Corp, said: 'Sinopec has always actively
sought to strengthen and expand its co-operation with multi-national
corporations, to introduce first-class technology, advanced management skills
and further improve the competitiveness of the company.


'Following China's accession to the WTO, this project, as the central pillar
of the Shanghai chemical zone, will promote and lead economic development in
Shanghai and Eastern China and help bring China's petrochemical industry to a
new level of performance.'


Graham Hunt, BP Chemicals China chief executive, paid tribute to the close
relationship and teamwork that has developed between the partners: 'The SECCO
joint venture could not have been created without the continuing full support
and hard work of our partners and the strong support of Shanghai. It marks yet
a further deepening of our longstanding relationship with Sinopec. We are
confident that this teamwork will enable the start up of the complex on
schedule in 2005.'


The SECCO complex will comprise a 900,000 tonnes a year naphtha-fed ethylene
cracker and downstream derivative petrochemical plants, with combined
polyethylene, polypropylene and polystyrene production of more than 1 million
tonnes a year, and world-scale styrene, acrylonitrile and other olefins
derivatives units. Output will total almost 2.3 millions tonnes of product a
year.


SECCO directors include John Morgan from BP, who will also act as the
company's president, and Liu Xunfeng from Sinopec, who will act as executive
vice president and project management team director. Principal SECCO offices
are being established in Shanghai. SECCO will now tender for design and
construction contracts with the aim of breaking ground in the first half of
2002.


SECCO's manufacturing and marketing organization will serve the demands of the
growing east China market. BP's leading technology and business processes
combined with Sinopec's extensive petrochemicals experience will play a key
role in establishing a best-in-class enterprise.


Notes to editors:


*      The main downstream and derivatives plants are planned to produce:
polyethylene (600,000 tonnes a year), propylene (590,000 tonnes a year),
polypropylene (250,000 tonnes a year), styrene (500,000 tonnes a year),
polystyrene (300,000 tonnes a year), acrylonitrile (260,000 tonnes a year),
aromatics (500,000 tonnes a year) and butadiene (150,000 tonnes a year) .


*      The SECCO complex will be about 50 kilometres from the centre of
Shanghai and 12km from SPC's site at Jinshanwei. The complex will be designed
with latest technologies and emissions from the site will be strictly
controlled to meet international standards.


*      In October 2000 BP took a 2.2 per cent equity stake in Sinopec through
the company's initial public offering. In addition to the SECCO project, the
two companies have agreed to work on a number of joint ventures including
plans to develop a project to jointly build a world-scale PTA plant, probably
integrated with the SECCO complex, and to form a joint venture to develop a
network of 500 service stations in Zhejiang province, East China.


*      BP has so far invested around $4 billion in China, excluding IPO
investments, making it the largest foreign oil investor in the country. In
March 2000 BP also took a 2.2 per cent equity stake in PetroChina through its
IPO.


*      Sinopec Corporation was established in February 2000 and is the largest
integrated petrochemical company in China. Its main businesses include oil and
gas exploration, development and production; refining and oil products
trading, transportation and marketing; and the production and marketing of
petrochemicals.  At the end of 2000, Sinopec Corp had assets valued RMB 347.4
billion and an annual turnover of RMB 328.9 billion.


*      SPC is one of the largest integrated petrochemical enterprises in China
and has four main business areas: refining, chemicals, fibres and plastics.
The company's site at Jinshanwei covers an area of 9.4 km2. At the end of
2000, SPC's assets had total value of RMB 22.1 billion, with a refining
capacity of seven million tonnes a year and a total ethylene capacity of
590,000 tonnes a year. SPC is listed on stock exchanges in Shanghai, Hong Kong
and New York.


Further enquiries:


David Nicholas, BP press office, London: [phone]

Zhang Jianning, BP, Beijing: [phone]


                                   - ENDS -