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Oil reserves to be ready in 1 year
[ 2007-06-28 17:03 ]

The last two of the first four strategic oil reserve bases in China, the world's second-biggest oil consumer, are expected to kick off operations within a year, according to two State-owned oil giants.

An official from China Petroleum & Chemical Corporation, known as Sinopec Group, told China Daily it would start to fill crude oil into a base in Huangdao of East China's Shandong Province by the end of this year.

"We are losing no time building the base in line with the State's requirements," said the official, who asked not to be named.

A source from China National Petroleum Corporation (CNPC), parent of Hong Kong- and New York-listed PetroChina, said a base under construction in the northeastern port city of Dalian will be filled with oil as early as the first half of 2008.

Both bases will be able to stockpile more than 3 million tons of crude oil.

The first two bases, both located in East China's Zhejiang Province, are already operational with a capacity of 5 million tons each. They are operated by Sinopec Group and Sinochem, another Chinese energy supplier.

The four bases are not enough to ensure China's energy security if there is an interruption in petroleum supplies, experts say.

By contrast, the United States, the world's top oil user, has a strategic petroleum reserve of 94 million tons.

The Bush administration announced in January it would more than double the reserve within the next two decades.

China is planning to build a second-phase strategic oil reserve of 28 million tons, according to sources from China National Development and Reform Commission, the country's top economic planner. But no time frame has been revealed.

Many local authorities, including those from South China's Guangdong and Hainan provinces, said earlier this year that they were discussing with the central government to build new strategic oil reserve bases in their regions.

Xia Yishan, director of the China Energy Strategy Research Center at China Institute of International Studies, said: "We need a bigger strategic oil reserve for a rainy day, but not as much as what the US has."

Xia said China should have a strategic oil reserve equal to 15-20 percent of the country's annual crude oil imports.

China's crude imports have outpaced its domestic production in recent years in order to satisfy strong demand boosted by fast economic growth.

The country imported 67.4 million tons of crude in the first five months of this year, jumping by 9.6 percent from a year ago, according to industry data.

However, production at home grew by just 1.7 percent to 77.5 million tons.

Gong Jinshuang, a senior researcher from Sinopec Group, forecast full-year imports to climb 10 percent from 145.2 million tons in 2006.

Oil imports are widely forecast to grow rapidly over the next two decades to meet mounting domestic demand, despite the milestone discovery of a 1-billion-ton oilfield in North China's Bohai Bay, announced by CNPC at the beginning of last month.

(China Daily 06/28/2007 page 13)

Vocabulary:

strategic oil reserve:石油戰略儲備

crude oil:原油

stockpile:儲存

(英語點津 Linda 編輯)

About the broadcaster:

Bernice Chan is a foreign expert at China Daily Website. Originally from Vancouver, Canada, Bernice has written for newspapers and magazines in Hong Kong and most recently worked as a broadcaster for the Canadian Broadcasting Corporation, producing current affairs shows and documentaries.

 
 
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