Posted on 03/06/2006 10:25:36 AM PST by indcons
Beijing - China plans to begin storing oil at its first strategic oil base by the end of this year and put into operation three more bases by 2008, a senior official said on Monday.
The first oil reserve base is under construction at Zhenhai, in the eastern province of Zhejiang, and will begin filling tanks by the end of 2006, Ma Kai, minister for the National Development and Reform Commission, told reporters.
Three more bases will be brought into operation during 2007 and 2008, Ma said on the sidelines of the ongoing National People's Congress (NPC), China's nominal parliament.
The National Development and Reform Commission, China's top economic policy body, last month said the country needs to increase refining capacity and raise prices of oil-based products.
The commission warned that existing refineries were 'stretched to the limit' and need to process and extra 17 million tons of oil to meet demand.
'Low refined-oil prices and a fragile supply system are major problems facing China's refining industry,' the official Xinhua news agency quoted the commission as saying in a report.
China's oil demand is expected to rise about 6 per cent this year, the report said.
Despite the high demand, China's oil refining industry lost about 30 billion yuan (3.7 billion dollars) last year, compared with a profit of 20.8 billion yuan in 2004.
Refining capacity reached 328 million tons, an increase of 14 million tons from 2004, the commission said.
About 286 million tons of crude oil were processed last year, 17.6 million tons more than in 2004, it said.
China imported 165 million tons of crude oil last year, almost the same as in 2004. But soaring prices raised the cost of the imports by about 32 per cent to 60 billion dollars, the commission said.
The NPC is scheduled to approve a five-year economic plan at the end of its 10-day session on March 14.
© 2006 dpa - Deutsche Presse-Agentur
They will start buying up oil to fill their reserves in late 2006. Is this another attempt to run up oil prices prior to the election? They did the same thing in 2004 buying more oil than they had any hopes of refining.
They were supposed to have started filling their reserves last year.
They're trying to immunize themselves against a certain USN blockade of their ports in the event of conflict with Taiwan. Right now their economy would collapse in a week if oil tankers couldn't dock at Chinese ports.
I can't see Taiwan heating up for at least 7-10 more years. The Chinese military is currently procuring the tools they need (advanced fighters, amphibs, etc), but it will take some years to get their collective poop in one sock.
Seems about time for the Spratley Islands to get back into the news.
Right. This story sounds like smoke'n'mirrors, or Bravo Sierra?
It's hard telling. Disinformation of some kind. I think they've been building their strategic reserves up for awhile, now, though.
There is also likely a clash pending with them over Iran, as they are clearly not going to go along with any sanctions that involve nixing their $70 billion oil deal with Iran...
Well I know where they will get that reserve oil from, Can anyone guess?
Thats right, Good Ol' Hugo Chavez will cut back on the US Shipments to help fill up those reserves.
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