The Cambodian firm set to operate the Kingdom’s first oil refinery inked an agreement yesterday with a Chinese state-owned petroleum company to cover the landmark project’s first phase of construction.

Cambodia Petrochemical Company (CPC), which first announced plans to build an oil refinery in 2011, signed a contract with the Chinese National Petroleum Company (CNPC) to cover the engineering, procurement and construction of the first phase of the refinery, valued at $620 million.

According to a presentation at the signing ceremony, the refinery will be able to process 5 million tonnes of crude oil annually once it is completed by the end of 2018.

“This is a good opportunity for Cambodia to start to build its reputation to become an oil producer that can export refined crude to other countries, especially in the ASEAN region,” said Hann Khieng, managing director of CPC.

The $2.3 billion refinery is set to be built on 365 hectares in Kampot province. The project has seen little progress despite securing $1.67 billion in funding from the Export-Import Bank of China in 2013.

The plant is a joint venture between CPC and Chinese firms Sinomach and China National Automation Control System Corporation.

Meng Saktheara, secretary of state at the Ministry of Mines and Energy, said that the completion of the long-awaited refinery would provide Cambodia the capability to process crude oil extracted from its offshore drilling platforms.

However, as it could still be several years before the first oil platform is operational, he added: “I think by 2018 it will be primarily used for [refining] imported crude.”