China Petroleum and Chemical Corp, Asia’s biggest refiner, has announced it is close to an agreement to sell a stake in a $2.8bn ethylene plant in China to Saudi Basic Industries Corp (Sabic).

As partners, the venture will build the plant in northern China’s Tianjin city which will produce 1 million metric tonnes of ethylene per year.

Sinopec, as Beijing-based China Petroleum is known, plans to start operating the plant by September 2009 and it is thought that Sabic will be investing around $1bn in the plant.

Tianjin vice mayor Liang Dongliang said recently, “A decision has basically been made and a final contract is yet to be signed.”

China as a nation plans to more than double its production capacity of ethylene to 18 million tpy by 2010, from 7.55 million in 2005.