Economists watching the west-east gas pipeline project point out that the construction of this long distance, large-caliber pipeline will do more that enhance the energy base of East China. Along its route it will impact on the potential development of such industries as iron and steel and cement manufacture. There will be knock on benefits to the mechanical and electronic engineering sectors in the provinces it passes through.
The pipeline will straddle 10 provinces and autonomous regions. It may be expected to require 37 million cubic meters of earthworks. It will consume 1.7 million tons of steel and massive material resources in cement, timber, compressors, instrumentation, automated valves etc.
46 billion yuan (US $5.6 billion) will be invested in the trunk lines of the pipeline project. Besides this, there will be an input of another 100 billion yuan (about US $12 billion) necessary to tap the oil fields at source and to lay down subsidiary pipeline networks in the cities along the corridor. Such expenditures make this a very major investment indeed. The Western provinces expect to benefit from about 34 billion yuan (about US $4 billion) of this and have high hopes for the creation of new jobs against a background of stimulation of market forces.
On completion of the pipeline project, Tarim basin gas can be expected to generate 570 thousand tons of light hydrocarbons and 910 thousand tons of liquefied methane gas. Now the relevant government departments and enterprises in the field are drafting blueprints for the use of these quality raw materials to support large-scale ethane production. They wish to seize the opportunity to expand the chemical industry as a ‘locomotive industry’ driving general economic development further forward.
Experts hold that west-to-east gas transfer will accelerate the restructuring of the industrial base in the Yangtze River Delta area. When the volume of gas exported to East China reaches 20 billion cubic meters a year, it will have become equivalent to a supply of some 20 million tons of crude oil or 27 million tons of coal. If this gas could all be applied to the production of chemical fertilizer or electricity energy, it could be made into 15 million tons of synthetic ammonia or generate 100 billion kw of electrical energy.
Gas flowing to the domestic fuel market in East China will in turn stimulate development in the local manufacturing, installation and construction sectors. In Shanghai, Jiangsu province and Zhejiang province alone, there are 17 million households in need of natural gas. In ten years, this number will reach 34 million, signaling a potential market value of 60 billion yuan in the mechanic and civil engineering sectors. Moreover, suppliers of domestic appliances using the energy-saving and environment-friendly natural gas will also enjoy an unprecedented boom in production and sales.