Nippon Oil Corp. said Monday it will refine crude oil for the Chinese oil firm PetroChina Co. through March.

This is the first time Japanese and Chinese oil companies have struck a partnership deal in the field of crude oil processing, Japan’s leading oil refiner said.

Under the agreement, Nippon Oil will refine for Beijing-based PetroChina’s overseas trading arm some 20,000 barrels of oil at its six refineries in Japan. It will also ship the finished product to China.

The alliance comes amid surging demand in China for petrochemical products for power generation and manufacturing purposes, with oil refiners facing a shortage in their refining capacity.

The partnership will improve Nippon Oil’s facility utilization, company officials said.

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