I. Why Heilongjiang's Fuel Processing Industry Warrants Dedicated Study

Heilongjiang is home to China's most important onshore oilfield and the largest coking coal reserves in northeast China — two resource arteries that occupy distinct geographies but have jointly defined the province's heavy industrial identity. The Daqing Oilfield, discovered in 1959, has cumulatively produced more than 2.5 billion tons of crude oil, accounting for 36% of China's total onshore crude output (Xinhua, November 2024). The four coal cities — Hegang, Shuangyashan, Qitaihe, and Jixi — hold over 90% of the province's coal reserves, with Qitaihe's coking coal designated a nationally scarce coal type under protective extraction controls (Longmay Group website).

The two industrial lines have taken sharply different evolutionary paths over the past decade: the petrochemical side continues climbing toward higher-value materials, while coal chemical operators are searching for downstream chemical extensions as coal reserves trend irreversibly downward. This shared pressure of shrinking raw material supply makes the transformation question particularly urgent.

II. The Refining Core: Daqing's Dual-Engine Structure

Daqing Petrochemical

Daqing Petrochemical, a subsidiary of CNPC, is a national-level integrated refining and chemical base built directly on top of the Daqing Oilfield. During the 14th Five-Year Plan period, the company completed ethylene debottlenecking upgrades and added a new 200,000-ton/year ABS unit, raising total ethylene capacity to 1.38 million tons/year (Heilongjiang Provincial Ministry of Industry and Information Technology, January 2024). Even in 2023, when full-equipment maintenance was conducted, ethylene output reached 1.059 million tons — the eighth consecutive year of surpassing one million tons. In 2024, the three ethylene units collectively exceeded 1.3 million tons.

Over the full 14th Five-Year Plan period, Daqing Petrochemical processed more than 300 million tons of crude cumulatively, developed 33 new products, produced 193,000 tons of new materials, and built China's first industrial pilot unit for 1-octene and other alpha-olefin synthesis — a route the company describes as "refine-chemical-produce-material" (Heilongjiang News Network, February 2026).

Daqing Refining

Daqing Refining Co., Ltd., also under CNPC, plays a complementary role. In 2024, its crude oil processing volume hit the highest level in nearly a decade, increasing by 715,100 tons year-on-year. Paraffin, jet fuel, lubricant base oil, and polypropylene new materials all set historical production records (Sina Finance, January 2025). The two companies together account for approximately 19 million tons/year of primary crude processing capacity in the Daqing area.

Harbin Petrochemical (Harbin Refinery) was once another provincial refinery of note but has since been integrated into CNPC's consolidated refining network, with limited independent provincial-level disclosure; its weight in the current industrial landscape is considerably smaller than Daqing's two majors.

III. Upstream Foundation: Daqing Oilfield's "Hard Stable Production"

The raw material security underpinning the refining side is the Daqing Oilfield's sustained output. In 2023, the field produced 30.041 million tons of crude oil, maintaining the 30-million-ton level for nine consecutive years. In 2024, output again exceeded 30 million tons, completing ten consecutive years of high-quality stable production, with tertiary recovery (polymer flooding, compound flooding) output surpassing 10 million tons (Xinhua, November 2024).

This record reflects decades of technical investment in enhanced oil recovery — over the past 23 years, tertiary recovery output has annually exceeded 10 million tons, with cumulative production approaching 320 million tons. This provides the direct feedstock guarantee for the Daqing refining base, and constitutes the most meaningful structural difference between Heilongjiang's petroleum processing industry and that of other resource-dependent provinces: on-site refining eliminates long-haul transport costs at scale.

IV. Coal Chemical Transformation: Four Cities, Four Paths

The four coal cities of Heilongjiang share a common predicament: coal reserves are declining, peak production is in the past, and population outflow has been severe. Extending into coal chemicals is widely regarded as the critical mechanism for absorbing remaining resources and stabilizing employment.

Hegang has taken the "coal-to-fertilizer" route, building an integrated chain with annual capacity of 300,000 tons of synthetic ammonia, 520,000 tons of large-particle urea, and 300,000 tons of green value-added compound fertilizer — making it the largest coal-based large-particle urea production base in northeast China (Heilongjiang Provincial Government, November 2025).

Qitaihe holds its competitive advantage in coking coal. Longmay Group's Qitaihe subsidiary mines the Boli coalfield, producing coking coal known for low sulfur, low phosphorus, medium ash, and high calorific value; roughly 40% of northeast China's metallurgical coal originates from Longmay. Qitaihe's coking enterprises have begun implementing a "coal-electricity-chemicals-heat" poly-generation model, taking incremental but substantive steps toward modern coal chemicals (People's Daily Heilongjiang, May 2022).

Shuangyashan, rich in long-flame and gas coal, is in the early feasibility stages for coal-to-oil and coal-to-olefins megaprojects. Jixi has focused on modern new-type coal and new energy chemical industry projects (Jixi Municipal Government, 2023).

Each city has a distinct emphasis, but all face the same three-layered pressure: high capital thresholds for coal chemical projects, long payback periods, and tightening carbon emission constraints.

V. Supply Chain Position and Upstream-Downstream Relationships

Heilongjiang's petroleum and coal processing industry occupies the midstream position in its respective value chains. On the oil side, Daqing Oilfield's sustained production is the foundational feedstock guarantee. On the coal side, Longmay Group, the province's largest state-owned coal enterprise, handles mining and washing, serving as the primary raw material source for coal chemical operators.

Downstream, finished petroleum products — gasoline, diesel, jet fuel — produced by Daqing Petrochemical and Daqing Refining flow primarily to north and northeast China markets, while chemical derivatives such as ethylene, polyethylene, polypropylene, and ABS resin address domestic import substitution demand. Hegang's large-particle urea serves agricultural markets across northeast and north China.

Within this chain, the small and mid-sized enterprises supplying components, chemical auxiliaries, engineering services, safety testing, and logistics to the refining and coal chemical majors form a sizable but relatively invisible supply layer distributed across greater Daqing and the four coal cities. This tier represents some of the highest-value sales penetration points for external business development teams. Sales teams seeking to supply these refining and chemical facilities can use Tianxia Gongchang to filter factory directories and key decision-maker contacts by region and industry, enabling faster client identification.

VI. Key Pressures and Transformation Trajectory

The structural pressures on Heilongjiang's fuel processing industry take different forms on the petroleum and coal sides.

On the petroleum refining side, the core challenge is peaking demand for finished fuels. As electric vehicle penetration continues rising, the consensus view is that conventional automotive fuel demand has topped out. Both Daqing Petrochemical and Daqing Refining have shifted strategic emphasis toward chemicals and specialty materials to grow high-value product ratios. Declining crude quality — rising water cuts from maturing fields — also imposes persistent pressure on processing efficiency.

On the coal chemical side, pressure comes primarily from carbon emission constraints. Conventional coking is a high-carbon process; under China's dual-carbon target framework, smaller coke plants face accelerating phase-out, while local governments' push toward coal-to-fertilizer and coal-to-specialty-chemicals partially sidesteps the tightening regulatory environment targeting pure fuel pathways.

Heilongjiang's 14th Five-Year Energy Plan explicitly encouraged energy storage and new-energy microgrid development, signaling provincial-level intent to position for a post-fossil-fuel industrial base. But the sheer scale of existing petroleum and coal processing assets means this transition will inevitably be gradual — through the remainder of this decade at minimum, these two legacy lines will remain pillars of provincial industrial output.

Data Sources

  • Tianxia Gongchang (Heilongjiang petroleum and coal fuel processing industry factory directory and industry data)
  • Heilongjiang Provincial Ministry of Industry and Information Technology — "Daqing Petrochemical Ethylene Output Exceeds One Million Tons for Eight Consecutive Years," January 2024
  • Xinhua News Agency — "Daqing Oilfield: Growing the Second Curve," November 2024
  • Heilongjiang News Network — "14th Five-Year Review: Daqing Petrochemical Wins Development Initiative Through Reform Initiative," February 2026
  • Sina Finance — "Daqing Refining Company 2024 Annual News Review," January 2025
  • Heilongjiang Provincial Government — "Hegang's Modern Agriculture and Coal Chemical Industry New Vitality," November 2025
  • Longmay Group official website — company introduction and Qitaihe subsidiary profile
  • People's Daily Heilongjiang — "Turning Coal into Gold: Legacy Coking Enterprises Find New Life," May 2022
  • Jixi Municipal Government — "Modern New-Type Coal and New Energy Chemical Industry Projects," 2023
  • National Energy Administration — Heilongjiang Coal Mine Production Capacity Data