The two parties will jointly fund and set up a joint venture, Qingdao Zhenhua Oil Warehouse Company, for the construction and operation of 800,000 cu m crude oil storage tank. The project will start construction by the end of this year and is scheduled for completion in 2020.

The project aims to improve the crude oil storage and handling capacity of Dongjiakou port area. The advanced terminal facilities at Qingdao port and stable imported oil product resources from Zhenhua Oil will provide better oil storage and transportation services to the customers.

Dongjiakou port area is the major oil product handling base in China. It currently has a VLCC crude oil terminal and an aframax terminal with a handling capacity of 25m tons annually. The port had started construction of the second phase oil terminal project including the second VLCC crude oil terminal plus another aframax terminal, which are