China sets route for second West-East natural gas pipeline

China National Petroleum Corporation (CNPC) announced on Monday the route of China's second West-East natural gas pipeline has been decided to pipe gas imported from Central Asia to the Pearl River and Yangtze River delta areas.
The pipeline would cross 13 Chinese regions, carrying natural gas from central Asian countries, including Turkmenistan, and northwest China's Xinjiang Uygur Autonomous Region to eastern and southern China, including Shanghai and Guangdong Province.

The main line would measure 4,859 kilometers long, and the total length, including branch lines, would exceed 7,000 kilometers, said CNPC, the sole investor in the project and the country's largest oil company.

Construction would begin in 2008 and gas supply in 2010. The designed annual transmission volume would be 30 billion cubic meters.

CNPC signed a production sharing contract and gas sales and purchase agreement with Turkmenistan in July to import 30 billion cubic meters of gas annually through the planned Central Asia Gas Pipeline for 30 years.

The imported gas would be piped into the second West-East natural gas pipeline in Horgos, Xinjiang, said CNPC.

The project has been approved by the National Development and Reform Commission (NDRC), the country's top economic planner, and feasibility research is expected to be finished by the end of October.

The pipeline, the second after China's first West-East natural gas pipeline, which went into operation in 2004, is considered significant for improving China's energy consumption mode.

The government plans to raise the ratio of natural gas in its energy consumption structure by 2.5 percentage points to 5.3 percent by 2010.

According to estimates by CNPC, the full operation of the second West-East pipeline will raise the ratio by one to two percentage points, while replacing 76.8 million tons of coal and reducing emissions of sulfur dioxide by 1.66 million tons and carbon dioxide by 150 million tons.

The first West-East pipeline, which pipes gas from the Tarim Basin of Xinjiang to Shanghai, transmits 12 billion cubic meters of natural gas annually.

By connecting Central Asia to China's economically prosperous Pearl River Delta and the Yangtze River Delta, and linking natural gas fields in the Tarim, Junggar, Tuha and Erdos basins, the second West-East pipeline would improve China's energy consumption structure by increasing natural gas use and promoting international energy cooperation, said experts.

China's booming demand for natural gas has prompted fierce competition.

China Petroleum and Chemical Corporation (Sinopec), China's second largest oil firm, said it would start construction of its Sichuan-to East-China Gas Project to transmit gas from the Puguang field in southwestern Sichuan Province to Shanghai at the end of this month.

The Sinopec project is estimated to have a total investment of 63.2 billion yuan (8.3 billion U.S. dollars). Gas supply is expected to commence by the end of 2008, said the company in its interim results.

Sources from Sinopec said the company was also planning to transmit natural gas of the Puguang gas field to feed the Pearl River Delta.