Myanmar-China Pipeline to Start Construction in 2009

• Comments
• Print
• Email

 

The construction of a Myanmar-China Pipeline, with the total investment of $2.55 billion, is to start next year. This will be China’s third overseas oil and gas pipeline from a foreign country. It is reported that PetroChina will be the holding company for the pipeline constructed jointly by China, Burma, India, and Korea. Mi Dongsheng, director of Development and Reform Commission of Yunnan Province, revealed Yunnan was set to start construction on the pipeline from the first half of 2009 as a part of the province’s 72 billion yuan energy project.

PetroChina has not commented on the news, but an insider told China Business News that the construction of the pipeline might start next year.

China already has two overseas oil and gas pipelines in the north and west. Tens of millions of tons of crude oil have been transported through the Kazakhstan-China pipeline, China’s first. China is also planning to build a natural gas pipeline between the two countries. At the end of October this year, PetroChina signed a contract with Russia-based Transnef, agreeing to build and operate the Russia-China crude oil pipeline from Skovorodino, north of the Amur River, into China.

The Myanmar-China pipeline has drawn much attention. The pipeline would start from the west coast of Myanmar and stretch into China through Ruili, Yunnan and finally reach Kunming. It will be able to transport crude oil directly into China without passing through the Malacca Strait, saving time and avoiding the risk of that dangerous region.

Kunlun Gas Company (Kunlun), a PetroChina subsidiary, Yunnan Investment Group, Kunming Gas Holding Company(Kunming Gas), and Yunnan Chang’an Investment Company signed the first natural gas distribution contract on September 10 this year. The four parties will establish a new joint venture. Kunlun will hold 51%, Kunming Gas and Yunnan Investment Croup 20% each, and Yunnan Chang’an Investment Company Limited will take a 9% stake.

It is reported that Myanmar has authorized China to manage the pipeline. The demand for oil products in Yunnan has been rising. In the first half of this year alone, wholesale companies�turnover in Yunnan rose by 11.99% year on year. The whole of Yunnan Province and the west of China will greatly benefit from the pipeline.