Sino-Myanmar oil pipeline starts construction

Nov. 23, 2009 (China Knowledge) - China National Petroleum Corp, the parent of PetroChina Co Ltd<601857><0857><PTR>, has started building a 771-kilometer oil pipeline that will connect China and Myanmar, sources reported.

According to an officer of CNPC, the pipeline will stretch from Madh Island to Kunming by way of Dali and Chuxiong, Yunnan Province. Initially, the pipeline will carry 12 million tons of crude oil per year. Ultimately, it will be able to carry 22 million tons per year.

In addition, CNPC is conducting a feasibility study for the construction of a refinery with a processing capacity exceeding 10 million tons a year in Kunming.

China has received more than 10 million tons of crude oil from Kazakhstan through a pipeline. A pipeline connecting China and Russia is expected to start construction by the end of this year.

Reportedly, CNPC on Nov. 22 signed a memorandum of understanding to expand a refinery in Khartoum, Sudan.

The Chinese oil giant and a local firm each hold a 50% stake in the refinery, which went into operation in May 2000 with a designed processing capacity of 2.5 million tons per year. The annual capacity was increased to 5 million tons in June 2006.

At present, the refinery supplies 80% of the refined oil in Sudan.