CNPC goes natural
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China National Petroleum Corporation (CNPC) signed a natural gas deal with China Resources (Holdings) Tuesday, a move to enhance its business in the natural gas sector.
The deal includes cooperation in natural gas distribution, gas-fired power, oil marketing and overseas investments, according to an an-nouncement on CNPC's website.
CNPC is Asia's largest oil and gas producer and supplier. The State-owned company is the parent company of PetroChina, the New York-listed firm that recently ranked number one on the Financial Times top 500 enterprises list.
The Hong Kong-based China Resources is a leading importer of food and energy-related products to Hong Kong.
CNPC already leads China in natural gas output, producing 80 percent of the nation's total.
Experts said that CNPC has put more emphasis on natural gas exploitation and utilization as part of a strategic move to boost profits.
Earlier this month, China raised the wholesale price of domestically-produced natural gas by around 25 percent, which will benefit CNPC and oft-rival Sinopec.
Natural gas benchmark prices will go up by 230 yuan ($33.87) to 1,155 yuan ($170.1) per 1,000 cubic meters, according to the National Development and Reform Commission.
Data from the National Bureau of Statistics shows natural gas output reached 31.89 billion cubic meters in the first four months of 2010, a 13.1 percent increase from 2009.
"Compared with other fossil fuels such as coal and oil, China's consumption of natural gas will grow more rapidly, which is in line with the government's plan to use more clean energy," said Lin Boqiang, a professor at Xiamen University.
The government hopes natural gas consumption will account for 10 percent of China's annual energy consumption by 2020, nearly tripling from the current level, and the country will consume 300 billion cubic meters of natural gas annually within a decade.
In another development, PetroChina will start production at an expanded Ningxia refinery at the end of 2011, CNPC said Tuesday.
The 5 million metric ton-a-year refinery in northwestern China is designed to provide 1.67 million tons of gasoline and 2.29 million tons of diesel a year, CNPC said.
