China-Rus­sia pipe­line fu­els trade, cuts costs

China Daily (USA) - - Q&A WITH CEO - By LYU CHANG and ZHANG YU By ZHANG YU and LYUCHANG

A new China-Rus­sia oil pipe­line will help guar­an­tee China’s oil con­sump­tion and, cut its trans­porta­tion costs, said Gao Jian, an oil an­a­lyst at com­modi­ties con­sul­tancy Sub­lime China In­for­ma­tion Co Ltd.

Com­pared with other coun­tries, Rus­sia has oil of quite good qual­ity, and its lo­ca­tion near China makes it com­pet­i­tive in ex­port­ing oil to China, Gao said, adding that Rus­sia will cer­tainly be­come China’s largest ex­porter of oil in the near fu­ture.

The Euro­pean eco­nomic sit­u­a­tion made Rus­sia shift its oil ex­port des­ti­na­tions to the Asia-Pa­cific re­gion, while China, as one of the world’s largest oil con­sumers, has the need to im­port oil from neigh­bor­ing coun­tries, ac­cord­ing to Gao.

Con­struc­tion of the sec­ond China-Rus­sia crude oil pipe­line started re­cently in north­east­ern China’s Hei­longjiang

A new China-Rus­sia oil pipe­line will help guar­an­tee China’s oil con­sump­tion and, cut its trans­porta­tion costs, said Gao Jian, an oil an­a­lyst at com­modi­ties con­sul­tancy Sub­lime China In­for­ma­tion Co Ltd.

Com­pared with other coun­tries, Rus­si­a­ha­soilofquite­good qual­ity, and its lo­ca­tion near China makes it com­pet­i­tive in ex­port­ing oil toChina, Gao said, addingth­atRus­si­aw­ill­cer­tainly be­comeChina’s largest ex­porter of oil in the near fu­ture.

The Euro­pean eco­nomic sit­u­a­tion made Rus­sia shift its oil ex­port des­ti­na­tions to theAsi­aPa­cific re­gion, while China, as one of the world’s largest oil con­sumers, has the need to im­port oil from neigh­bor­ing coun­tries, ac­cord­ing to Gao.

Con­struc­tion of the sec­ond prov­ince, a move that ex­pands the ca­pa­bil­ity for oil trans­porta­tion from Rus­sia to China.

The pipe­line, travers­ing the China-Rus­sia border, is 940 km in length and 813 mm in di­am­e­ter, with a ca­pac­ity to trans­port 15 mil­lion tons of crude oil an­nu­ally, ac­cord­ing to China Na­tional Petroleum Cor­po­ra­tion.

The Chi­nese sec­tion of the pipe­line starts from the border city of Mohe in Hei­longjiang, runs south­ward through the In­ner Mon­go­lia au­ton­o­mous re­gion and ends at Daqing in Hei­longjiang.

The pipe­line is ex­pected to be put into op­er­a­tion at the be­gin­ning of 2018.

It will run par­al­lel to an ex­ist­ing pipe­line — the first China-Rus­sia crude oil pipe­line that was put into use in 2011, which can also trans­port 15 mil­lion tons of oil each year.

Ac­cord­ing to the CNPC Eco­nomics & Tech­nol­ogy Re­search In­sti­tute, China im­ported 328 mil­lion tons of oil last year.

In 2015, Rus­sia ex­ported 41.04 mil­lion tons of crude oil to China, mak­ing China the coun­try’s largest oil im­porter, Rus­sian me­dia re­ported.

That means more than 12.5 per­cent of crude oil China im­ported last year was from Rus­sia.

China and Rus­sia signed a co­op­er­a­tion agree­ment on ex­pand­ing bi­lat­eral trade in crude oil in 2013.

Fol­low­ing the agree­ment, CNPC signed a trade con­tract with Ros­neft, Rus­sia’s largest oil pro­ducer, to ex­pand the sup­ply of oil for China.

Build­ing a new pipe­line is the main ac­tion un­der the con­tract.

the an­nual crude oil trans­porta­tion ca­pac­ity of the sec­ond Chi­naRus­sia oil pipe­line

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