China and Russia have agreed to join their efforts in building an
oil pipeline from Irkutsk of Russia to Daqing of northeast China's
Heilongjiang Province,
Pravda of Russia reported recently.
Through this pipeline, Russian oil will be exported to China and
other Asian countries.
Though abounding with oil reserve, Siberia has difficulty in
exporting its oil and further developing its petroleum industry.
Despite the low price of Russian oil, the high transport cost make
foreign companies turn to the Gulf Region for oil. Following
China's entry into the WTO and the coming up restructuring of its
oil industry, Russian oil dealers find the opportunity for them to
expand their exporting business.
Currently, each side of the new deal is verifying the plan and
reviewing problems concerning technology and investment. Sources
from Russia say that a formal contract will possibly be signed in
December next year.
According to the agreement, Yukos Oil Company, the second largest
of its kind in Russia, will invest US$150 million to build the
1,500 km section of the pipeline in Russia, while its Chinese
partner will inject US$50 million to construct the 760 km Chinese
section. Through the pipeline, which is expected to begin trial
operation in 2005, 20 million tons of oil will be sent to China
annually. By 2010, its annual transporting capacity will be raised
to 30 million tons.
(china.org.cn by Tang Fuchun November 30, 2002)