Chinese company Guangdong Zhenrong Energy will conduct studies for the construction of a refinery in the Export Processing Zone (EPZ) of the Brazilian state of Ceará, under a memorandum of understanding signed on Monday in Zhujiang Xincheng, on the outskirts of Guangzhou, with the governor of the Brazilian state.

Information released by the Ceará government showed that the refinery is expected to cost US$4 billion and provide jobs for 10,000 people during the construction period and 8,000 direct and indirect jobs when it starts operating.

The refinery the Ceará state government wants will have capacity to process 300,000 barrels of oil per day, with the Brazilian press reporting that Chinese company Qingdao Xinyutian Chemical was also present at the signing ceremony.

The funding for the project is expected to come from Chinese banks, also according to the statement from the Ceará government, adding that the memorandum signed now is part of the agreement signed in early 2016 between the governments of Brazil and China.

The Guangdong Zhenrong Energy Co. (GDZR) was founded in 2002 and specialises in trade of and investment in energy and natural resources, focusing on raw materials such as metals, coal and chemicals.

The largest shareholder of GDZR the Zhuhai Zhenrong Company, a large state- owned group and one of the five largest coal and oil product trading companies registered with the World Trade Organisation.