Graham Corporation has announced that it has been awarded a $2.2 million contract for an ejector system to be installed in the China National Offshore Oil Corporation (CNOOC) Huizhou Refinery. This is a world-scale grass roots refinery, located in Southeastern China, designed to process heavy sour crude, a less expensive but more plentiful feedstock. The Huizhou refinery's output is transportation fuels and certain products that will be used to manufacture petrochemical products by the CNOOC/Shell Nanhai petrochemical complex plant located nearby. This petrochemical plant also utilizes several Graham vacuum systems that were supplied in 2004.
Equipment for this order will be manufactured in Graham's Batavia, NY facility and with a local Chinese fabricator. Graham's subsidiary based in Suzhou, China, will provide quality assurance and project oversight for components built in China.
James R. Lines, President and CEO of Graham, comments: "Our China-based team did an excellent job of managing the customer relationship and successfully negotiating the final order. We believe Graham's expertise in designing and delivering systems capable of processing heavy sour crude, as well as its ability to have certain components built locally in China, were key factors in the customer decision-making process. This is our second Chinese refinery project order during the past three months and demonstrates our preparedness to win business in China."
The ejector system is scheduled for shipment during fiscal 2008's first quarter, ending June 30, 2008. Revenue for this contract will be paid in US dollars and recognized on a percentage-of-completion basis, with approximately 20% of the order value anticipated to be recognized in fiscal 2007.
