A PetroChina attendant fuels a motorcycle in Tazhong, Xinjiang Uygur autonomous region. Bloomberg News
China National Petroleum Corporation (CNPC), the country's largest oil company, has signed an agreement with Uzbekistan's state oil company to jointly develop an oilfield in the central Asian country.
The field has oil reserves of over 30 million tons, and is expected to have an annual capacity of 2 million tons, CNPC said on its website yesterday.
The project "will help meet Uzbekistan's demand for oil, and boost the development of China's natural gas upstream business and the Central Asia-China natural gas pipeline project", said CNPC.
It will also help CNPC improve its oil drilling technology, said the company.
As the world's second largest energy consumer, China has intensified energy cooperation with Central Asian countries, which are viewed as having favorable logistics and costs.
CNPC has started building the Central Asia-China gas pipeline, designed to ship gas from Turkmenistan to western China.
The project's designed gas transmission capacity is 30 billion cu m per year, a figure that could rise to 40 billion cu m.
CNPC's cooperation with Kazakhstan has lasted for over 10 years. The company acquired PetroKazakhstan for $4.18 billion in 2005.
Overseas business has become increasingly important for CNPC in recent years, with its overseas projects extending to Africa, Central Asia, the Middle East, the Americas and the Asia-Pacific.
The company said earlier it would strive for new progress in 2008 in overseas oil and gas prospecting to increase its reserves. The company aims "to maintain the sustainable development of its overseas business while maintaining high-speed growth in domestic oil and gas output".
With advanced technologies and refined prospecting, the company said it is "confident" it will discover new oil and gas fields, as well as accelerate oil output, refining and piping.
Central Asian countries have become an important source of China's oil imports, which have grown rapidly due to the widening gap between domestic consumption and production.
In 2007 China imported nearly 200 million tons of oil, up more than 10 percent from 2006. Imported oil accounted for 46 percent of the country's total consumption.
Analysts said that the country's oil imports will continue to see rapid increases. According to a recent report from the State Information Center, 55 percent of the country's oil consumption will be met by imports in 2010, and the figure will further rise to 66 percent in 2020.
The Middle East, Africa and the Asia-Pacific are currently the three main regions China imports oil from. Analysts said that China should further diversify its oil importing sources to ensure more sustainable supplies.