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China, Kazakhstan Try to "Strike a Breakthrough" in Energy Cooperation

China and Kazakhstan are trying to "strike a breakthrough" in energy cooperation as Kazakh President Nursultan Abishevich Nazarbayev is winding up his four-day state visit to China Wednesday.


Energy has been a prominent topic for the president's visit to China. According to the president, the two countries will begin constructing a second section of the planned 3,000-km-long Kazakhstan-China oil pipeline within the year.


China and Kazakhstan signed an agreement in 1997 to build an oil pipeline that will transport crude oil from the Caspian Sea continental shelf to China. The western section of the pipeline, running 448 km, is now operational.


The construction of the eastern section of the Kazakhstan-China oil pipeline, the Atasu-Alataw Pass oil pipeline, running over 1,000 km, is expected to begin within this year and be completed by the end of 2005, Nazarbayev said Tuesday at a press conference.


During the president's visit to China, the two sides signed a framework agreement on full-range cooperation in oil and natural gas.


Specific content of the agreement was not released, but a joint statement issued following talks between Chinese President Hu Jintao and President Nazarbayev said the two sides will "work together to finish the Atasu-Alataw Pass oil pipeline as soon as possible, and implement relevant oil development projects".


Kazakhstan supports China's oil companies to participate in the exploration and development of oil and natural gas in the Caspian Sea continental shelf, and the two sides will also accelerate the study on plans to lay natural gas pipelines from Kazakhstan to China, according to the statement.


Chinese Foreign Ministry spokesman Liu Jianchao called the framework agreement "an important result" of President Nazarbayev's visit to China. He said China hopes the agreement on oil pipeline construction will be implemented quickly.


Earlier reports said the middle section of the oil pipeline is also under study.


The Kazakhstan-China oil pipeline will cost an estimated investment between US$2.5 billion and 3 billion. Upon completion, the pipeline will transmit at least 20 million tons of crude oil annually.


Kazakhstan has a verified oil reserve of 4.6 billion tons at the Caspian Sea continental shelf, one of the three oil-rich regions in the world. Oil output of the region is expected to reach 100 million tons by 2010.


At the talks with Nazarbayev, Chinese President Hu put forward a four-point proposal on tapping the potentials of cooperation. Hu stressed that the two sides should "strike a breakthrough in energy cooperation".


Premier Wen Jiabao also praised the agreement on energy cooperation, saying enhanced cooperation in the field "conforms to the interests of both sides" and they should strive to ensure the projects go smoothly.


China became a net oil importer in 1993, and was the second largest oil importer in the world last year following the United States, with the imported crude oil exceeding 91 million tons. Experts predict that China will consume about 270 million tons of crude oil this year, with the net imports of over 100 million tons.


(Xinhua News Agency May 19, 2004)




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