China: Nation to get key oil reserve bases by year end

China will complete the construction of its first four strategic oil reserves by the end of this year, a senior government official said Monday.

“The progress has been smooth and all the four bases will be completed by the year end,” Zhang Guobao, administrator of the National Energy Administration (NEA), said after a press conference in Beijing. “Their total capacity will amount to 16.4 million cu m.”


…China started to build its strategic oil reserves in 2004, in order to fend off the risk of oil shortages and reduce the impact of oil price fluctuations. The government plans to build strategic oil reserves in three phases over 15 years, involving an estimated investment of 100 billion yuan ($14.6 billion).

The first four reserves, located in Dalian, Qingdao, Ningbo and Zhoushan, are expected to maintain strategic oil reserves equivalent to 30 days of imports in 2010.

The reserve in Ningbo, a coastal city in Zhejiang province, was put into operation in late 2006. It is the largest of the first four reserves, with a total storage capacity of 5.2 million cu m.

The central government is now reportedly selecting locations for the second batch of strategic oil reserves.

China Daily