[Observer Network Synthesis/Wang Yubo] British Reuters reported on March 24th that the oil pipeline of China-Myanmar oil and gas pipeline project was finally restarted after being shelved for two years, and the last 2.5 kilometers will be opened. This 770-kilometer-long oil pipeline in Myanmar and costing US$ 1.5 billion can finally start transporting crude oil to southwest China. From then on, some crude oil imported by China from the Middle East will be directly unloaded in Myanmar and transported back to China without going through the Straits of Malacca. The pipeline will also cooperate with Yunnan Petrochemical’s 10 million tons of oil refining projects, which will greatly alleviate the situation of lack of oil and gas in southwest China.
In October 2013, the natural gas pipeline of China-Myanmar oil and gas pipeline was officially put into production, and the designed natural gas transportation capacity was 12 billion cubic meters per year, thus ending the history of no pipeline natural gas in Yunnan-Guizhou Plateau in China.
On January 20, 2015, after five years of construction lag, the trial operation ceremony of the China-Myanmar crude oil pipeline project was held in Made Island, Kyaukphyu, Myanmar, and the port of Made Island was officially opened at the same time. However, due to various reasons, the crude oil gathering and transportation pipeline has not been connected, and the last 2.5km has not been opened, so this oil pipeline is almost at the end of the road.
Schematic diagram of the trend of China-Myanmar oil and gas pipeline
"Deutsche Welle" reported on March 26th that recent news from Myanmar’s official and industrial circles indicated that China and Myanmar had reached an agreement on various issues of this oil pipeline again after the project was interrupted for two years.
Located in MyanmarSpecial wharf for China-Myanmar oil pipeline on Kyaukphyu Mad Island.
China-Myanmar oil and gas pipeline is the fourth largest energy import channel in China after Central Asia oil and gas pipeline, China-Russia crude oil pipeline and offshore channel. The pipeline project consists of two parts: natural gas pipeline and crude oil pipeline. The starting point is Kyaukphyu, Myanmar, and the end point of the oil pipeline is Kunming, while the natural gas continues to arrive in Nanning, Guangxi. In the long-term planning, the oil pipeline will also extend to Chongqing in the north.
The new oil pipeline is an important infrastructure construction in the development of China’s "One Belt, One Road" economic strategy. In addition to the original maritime oil transportation route through the Straits of Malacca, it provides another pipeline to directly transport oil from the Middle East to China.
A person in charge of Myanmar Oil and Gas Company said that this agreement has yet to be finally signed by Myanmar Ministry of Electricity and Energy. A person familiar with this project in Myanmar’s industry said that the issues related to transportation tariffs and oil taxes and fees in Myanmar have been settled through discussion, and the two sides have not yet reached an agreement on port fees.
The insider, who asked not to be named, said that the two sides are working hard to negotiate the final terms and sign the contract. He said: "I can’t say for sure when the final terms will be completed, but it may be reached in a few days or early April."
Yunnan Petrochemical 1000 Refining Project Supporting China-Myanmar Oil Pipeline
The daily oil transportation capacity of this pipeline is 400,000 barrels, which is equivalent to 5% of China’s total daily oil imports. After PetroChina and Myanmar reached an agreement on oil transportation, refineries in Yunnan have started to operate. PetroChina plans to start trial production in Yunnan in June this year.
This project also aims to solve the problem of fuel shortage in southwest China. Although the agreement has not been finally signed, the oil pipeline in Myanmar has already started. According to the shipping data of Reuters, the oil tanker United Dynamic left the coast of the South Indian Ocean with 1 million barrels of crude oil and is expected to arrive in kyaukpyu, Myanmar this week.
A government official in Myanmar said that Myanmar had a "heated argument" with China because China started to transport oil tankers before the contract was signed. However, another Myanmar official said that the oil tanker had obtained permission from the military to enter Myanmar. PetroChina did not comment on this.