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China Aviation Oil Singapore Corp. started trading fuel oil this year, adding to its main product, jet fuel, Chief Executive Officer Meng Fanqiu said.
The supplier of jet fuel to China set up a fuel oil business in Singapore, where its shares are traded, and is in talks with BP Plc, its second-largest shareholder, on increased cooperation, Meng told reporters today.
BP has seconded traders to China Aviation’s risk management and trade departments in previous years, he said. The supply and trading of jet fuel will remain China Aviation’s main business in the next five years as demand for aviation services grows in China, Meng said.
“The trading of petrochemicals and other oil products will be an important supplement to our business,” he said. “But it should not be on par with the jet fuel business.”
China National Aviation Fuel Group Corp., the largest state-owned aviation fuel supplier in China, owns 50.9% of China Aviation. BP holds a 20% stake.
“This year, we have cooperation in the jet fuel and gasoil businesses,” Meng said. “We have been discussing opportunities in fuel oil as well. The details of our cooperation will need to be discussed further.”
China Aviation appointed Sun Li as its non-executive chairman, the company said today. Wang Kai Yuen, the current chair of the board, will become vice chairman. The appointments take effect starting Aug. 16.
Sun, previously China Aviation’s vice chairman, is also the president of China National Aviation Fuel.
China Aviation’s former chief executive officer Chen Jiulin was sentenced in 2006 to four years and three months in jail and fined $335,000 for his role in a US$550 million ($681 million) trading scandal that led to a reorganization of the company.
