China plans major oil, gas pipeline across Myanmar

China today announced revival of its plan to build a giant $2.9 bn oil and gas pipeline across Myanmar, in a major move to get a toehold on emerging Asian energy markets.    

China, which has outbid Indian oil companies in a number of major contracts in Myanmar, said the work on the new pipeline connecting Myanmar with its Yunnan province would begin early next year, the China Daily newspaper reported today.    

Quoting Chinese oil companies' officials, it said that the project, a joint venture between China and Myanmar, was being undertaken to reduce Beijing's over-dependence on energy transportation from the Gulf through the straits of Malacca.    

The project includes constructing two separate pipelines one worth $1.5 bn oil pipeline and the other $1.4 bn gas pipeline, with the country's major China Natural Petroleum Corporation holding a 50.9% stake in the project.    

The remaining stake would be held by Myanmar Oil and Gas Enterprises.    

Once completed, the pipeline is expected to provide an alternative route for China's crude import from West Asia and Africa through the straits of Malacca.    

Currently, 80% of China's crude imports of 200 mn tonne pass through the straits of Malacca. According to international energy agencies projections, China and India are going to be world's leading importers of oil and gas in next 10 years.    

China plans to extend its oil and gas pipelines by 60% by 2010. It has already made operational the first West-East gas pipeline in 2004 and the work on the second such project has already began in February this year.