China completes the world’s first gasoline shipment using blockchain technology

Credit: Sinochem Corporation

On April 2, it was announced that China has successfully used blockchain technology for a shipment of gasoline from China to Singapore.

Blockchain technology is a distributed
record of transactions that is maintained by a network of computers on the
internet. It is seen as a way to
simplify complex and lengthy transactions in energy trading and reduce costs by
digitalising key documents. 

While blockchain first emerged as the technology
and system underpinning cryptocurrency,
logistics and shipping sector is also one of the potential use cases for the
application of blockchain to optimise operations and processes.

On
April 2, it was announced
that China has successfully used blockchain technology for a shipment of
gasoline from China to Singapore.

This
blockchain gasoline shipment was the first of its kind and was carried out as a
trial by Sinochem Energy Technology Co. Ltd, a subsidiary of the state-owned
and China’s largest petrochemical company Sinochem
Corporation
.

Sinochem
Energy Technology sent a shipment from Quanzhou, China to Singapore, claiming
that it was the “first time that blockchain applications have been applied to
all key participants in the commodity trading process”.

In
fact, Sinochem Group has been experimenting with blockchain technology.

In December last year, Sinochem Group carried
out its first crude oil blockchain import transaction. The trial was China’s
first simulated transaction of crude oil import using blockchain technology.

According
to the company’s press
release
, the trial was a practical step for the blockchain technology to be
applied in China’s energy and petrochemical industry.

Sinochem
Group also stated that the data analysis of the effect of the simulated
transaction shows that digital bills of lading and smart contracts can
significantly enhance the execution efficiency of crude oil transactions and optimise
20% to 30% of the financing costs.

The
company also believed that blockchain will help improve the transparency of the
transaction business in China’s petrochemical industry and enhance the overall
risk management level of the industry.

Other
than the petrochemical industry, China also pioneered the use of blockchain
technology in the world’s first global agricultural trade.

In
January this year, as reported by Reuters, China and the US completed the world’s
first fully-fledged global agricultural trade using blockchain
. The
transaction involved a cargo of US soybeans being shipped to China, while all
the sales contract, letter of credit and certificates were digitalised on the ING’s
Easy Trading Connect (ETC) platform.

Companies
that were involved in this trade include: Louis Dreyfus Co, Shandong Bohi
Industry Co, ING, Societe Generale and ABN Amro. According to these
participating companies, the benefits of using blockchain include cost savings
and greater speed. It was said that in this particular agricultural trade, the
time spent on processing documents and data had been reduced five-fold.

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