Royal Dutch Shell's withdrawal from the China National Offshore Oil Corp. (CNOOC) Huizhou refinery project has illustrated the difficulties facing foreign firms looking to carve a role for themselves in China's refining sector. Despite the opening up of the wholesale sector last December, Chinese refining remains dominated by the country's Big Three - Sinopec, PetroChina and downstream newcomer CNOOC - posing a problem for international oil companies (IOCs) looking to secure supplies for their own retail networks in the country. Shell had been in talks with CNOOC on Huizhou for more than three years, and declined to say precisely why it pulled out, although fierce competition from Sinopec in the local Guangdong retail market may have been one factor.
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