Consumption Tax Refund Receivable

6 Months Ended

Jun. 30, 2013

Consumption Tax Refund Receivable [Abstract]

CONSUMPTION TAX REFUND RECEIVABLE

4         CONSUMPTION TAX REFUND RECEIVABLE

The PRC government enacted a regulation that provides that domestically purchased heavy oil to be used for producing ethylene and aromatics products are exempt from consumption tax. In addition, the consumption tax paid for imported heavy oil is to be refunded if it is used for producing ethylene and aromatics products. Given all the Group’s purchased heavy oils are, or are to be, used for the production of ethylene and aromatics products, the Group recognizes a consumption tax refund receivable when the consumption tax has been paid and the relevant heavy oils have been used for production. At June 30, 2013 and December 31, 2012, the Group recorded an estimated consumption tax refund amounting to approximately $93.7 million and $51.3 million, respectively.

In July 2013, a refund of approximately $67.7 million was received, and a refund of $34 million is expected to be approved and received in the second half of 2013.