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1st phase of oil reserve project completed

By Zhao Tingting (chinadaily.com.cn)
Updated: 2010-01-18 14:46

China has completed the first phase of the national strategic oil reserve project with the average cost of $58 per barrel in 2009, China Business News reported Monday, citing a senior energy official.

China inked loan-for-oil deals worth over $60 billion with Russia, Brazil and Venezuela last year, securing a crude oil supply of 75 million tons annually, said Zhang Guobao, head of the National Administration of Energy. The amount is equivalent to 42 percent of China's crude oil import in 2008.

China's crude oil output has maintained downward trend since last year. The nation imported record 21.26 million tons last December and imports in 2009 hit 204 million tons, according to customs data. The country's crude foreign dependence was expected to achieve 52 percent.

China took advantage of the slowing energy demand in the global market caused by the financial crisis to implement the "go out" energy strategy, Zhang said.

Zhang also said that China's crude oil pipeline project was settled after over ten year's negotiation. The pipeline construction has started in both Russia and China and was scheduled to be operational by the end of this year, with an annual throughput of 15 million tons.

China had invested 1.41 trillion yuan on fixed-assets of power, coal and coal industries in the first 11 months of last year, up 17 percent year-on-year.