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This month China's first strategic oil reserve will be completed and go into operation in October, said sources with the National Development and Reform Commission.

The oil reserve base in Zhenhai, east China's Zhejiang Province, has 52 storage tanks. Sixteen of them were erected last September and the remaining 36 will be completed this October. Twenty-eight of the storage tanks are made of high strength steel plates, said the commission.

Costing 3.7 billion yuan (US$462.5 million) and with a storage capacity of 5.20 million cubic meters the base is now ready for oil storage and operation.

The base, close to China's largest refinery, Sinopec Zhenhai Refining and Chemical Company, is located at the head of the YongHuNing oil pipeline which runs from Ningbo to Shanghai and Nanjing.

The completion of the base is a breakthrough for China which until now has had no national strategic oil reserves, said Zhang Guobao, deputy director of the National Development and Reform Commission.

China started to build national oil reserve bases in 2004. The sites of the first four are Zhenhai, Daishan in Zhejiang Province, Huangdao in east China's Shandong Province and Dalian in northeastern Liaoning Province.

(Xinhua News Agency August 10, 2006)