Oil Policy Unaffected by Attacks

The nation's oil imports and exports are not likely to be greatly affected by the United States' possible attack on Afghanistan, a top planning official said Tuesday.

"We would not change our energy policy because of the US response to the terrorists,'' said Zeng Peiyan, minister of the State Development Planning Commission, at the World Petroleum Congress Asia Region Meeting in Shanghai.

Zeng made the remarks in response to the recent turbulence of oil prices that resulted after the Bush administration's declaration of retaliation for last week's terrorist attacks.

Zeng also said China would open new blocks and undeveloped oil and gas reserves in western regions to foreign companies and allow them to explore and develop there.

"The move is expected to encourage foreign investment in the petroleum sector in western China to promote the economic development of the region, which is rich in oil and gas resources,'' said Zeng.

Commenting on the impact of the United States' possible retaliation, Li Hui, vice-president of China National Chemicals Import and Export Corporation, echoed Zeng, saying that the event would not force China to immediately reduce its imports from the Middle East.

"We need imports. That is clear. And Afghanistan does not export oil.

"Most of the domestic refineries made the whole-year production plan at the beginning of the year, and they would not change their oil-processing plan. That means the amount we import would not drop sharply,'' said Li.

Li's company is the nation's largest oil importer.

He said the company's plan to import and export 44 million tons this year would not change. The trade volume of the company last year reached 40 million tons.

"We think our current trade contract is safe, even if the price keeps rising,'' Li said.

"But we will wait and see how things develop. If necessary, we will make adjustments in the future,'' said Li.

Earlier last month, PetroChina, the largest domestic oil company, said its profit for this year would not be less than that of last year if the oil price remains at US$25 a barrel, while the present world price is US$27 a barrel.

"But in the long run, China should diversify its import nations to safeguard its energy supply security,'' Li said.

China, a net oil importer for years, imports one-third of its oil supply, mostly from the Middle East.

Addressing Tuesday's meeting, Zeng said the new blocks offered include the Kela II gas field in Northwest China's Tarim Basin, which is one of the largest onshore gas fields.

"China's western regions enjoy rich oil and gas resources. With the nation's west development campaign, the petroleum industry in the west would experience a new chance for development,'' said Zeng.

Western China makes up 70 per cent of the nation's territory and has one-fourth of the nation's total oil reserves and 63 per cent of gas reserves. "As far as I know, foreign companies are negotiating with Chinese companies to jointly explore and develop the reserves in the Tarim Basin,'' Zeng said.

(China Daily 09/19/2001)

In This Series

Oil Giants Watch Chinese Market

Terrorist Attack on US: Turning-Point in Post-Cold War Pattern

Psychological Factor Causes the Oil Price Surging

Construction of China's Largest Offshore Oilfield Launched

Oil Stockpile Target May Be Revised

Oil Giant Wants in on Gas Project

Billions of Tons of Oil Discovered in Tibet



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