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October 17, 2025

How should the petroleum and petrochemical industry "cycle"?

The "Circular Economy Promotion Law" will significantly boost the development of China's circular economy, but it also brings challenges to the petroleum and petrochemical industry. Actively building a "recycling" enterprise is essential for the industry to adapt and thrive in this new regulatory environment. During the Mid-Autumn Festival, people began to criticize the excessive packaging of mooncakes, calling for more eco-friendly alternatives. In daily life, how is the growing amount of waste being recycled? After the Olympics, will Beijing’s skies return to blue? These questions reflect the growing public awareness of environmental issues and the need for a sustainable approach. Fortunately, starting from January 1, 2009, China's circular economy development received strong legal support with the official implementation of the "Law of the People's Republic of China on the Promotion of Circular Economy." Passed by the Standing Committee of the 11th National People's Congress on August 29, after three years of review, this law marks a major step forward in China's environmental policy. What is the significance of this law? How does it affect the petrochemical industry? What strategies should companies adopt? To explore these issues, we spoke with Dr. Liu Hui, Executive Director of the Environmental Law Society of the China Law Society, and Chang Jiwen, Deputy Secretary General of the Legal Affairs Department at China National Petroleum Corporation. Reporter: Chang, Dr. Liu, you're doing well! With the increasing tension between China's economy and its resources and environment, what is the significance of enacting the "Circular Economy Promotion Law" now? Chang Jiwen: The fundamental solution lies in shifting from a high-energy, high-emission growth model to a recycling-based economy that supports sustainable development. This law is not just a temporary fix—it's a long-term strategy aimed at transforming economic structures and promoting green production and consumption. It reflects the government's commitment and confidence in driving a revolutionary change toward a greener future. Liu Hui: China has limited per capita resources, yet rapid development has led to resource depletion and severe pollution. Many enterprises are still unaware of the importance of energy efficiency and environmental protection. The "Circular Economy Promotion Law" addresses this by legally regulating behaviors across all sectors, creating a foundation for sustainable development. Reporter: Compared to previous laws, what makes this one unique? Chang Jiwen: The law combines specificity and comprehensiveness. It includes incentives like funding, tax breaks, and technological innovation, while integrating market mechanisms and administrative controls. It also clearly defines responsibilities at the enterprise, industry, and government levels, ensuring strict enforcement and accountability. Liu Hui: Unlike other laws, this one takes a higher-level approach, focusing on reducing, reusing, and recycling. It aligns with international practices while considering China's current situation and future needs. It encourages a shift in perspective, helping industries rethink their approach to energy saving and environmental protection. Reporter: How does this law specifically impact the petroleum and petrochemical industry? Chang Jiwen: The law applies to all sectors, including oil and chemical industries. For example, it sets energy consumption limits and encourages the use of clean fuels. This requires significant investment in technology and infrastructure, which may increase costs for traditional enterprises. Liu Hui: The industry faces high resource dependence and complex management challenges. Companies like CNPC must improve efficiency, reduce waste, and invest in cleaner technologies. While the law presents challenges, it also opens up new opportunities for innovation and sustainable growth. Reporter: What should petroleum and petrochemical companies do to comply? Chang Jiwen: First, they must understand the law and integrate circular economy principles into their operations. Second, they should update their systems, processes, and equipment. Third, they should actively build recycling models, promote energy efficiency, and embrace technological advancement. Liu Hui: Enterprises must change their mindset, develop comprehensive plans, and strengthen internal governance. By doing so, they can not only meet legal requirements but also position themselves for long-term success in a greener economy.

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