Handi Postpones Expansion


Chinese base stock supplier Hainan Handi Sunshine Petrochemical Co. must delay plans to expand its refinery on Hainans Yangpu Peninsula due to disputes with local communities, according to a source at Handi.

During the site preparation earlier this year, Handi found tombs and ponds belonging to residents of the Yangpu village, sparking a tussle between the company and the villagers, with the government acting as the intermediary.

Villagers want more compensation, and we have to negotiate with them, the source, who declined to be named, told Lube Report Asia. At this current stage we are not sure when the construction will begin.

Handi acquired hundreds of acres for the project. Some of it was purchased before 2011, but much was farmland belonging to different communities, and it took Handi a long time to settle initial compensation deals with each community, according to the Yangpu government.

Many local governments in China have instituted new policies in support of villagers rights, allowing villagers to demand new compensation measures and social risk evaluations for construction projects. As more villagers assert their rights, industrial expansion projects are becoming increasingly difficult.

For example, residents of Dongying city in the Shandong province are demanding social risk evaluations for each new land use proposal. In March 2013, the Hainan government agreed to allow all landless farmers to sign onto the local pension program for free, which is rare in China.

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