Gas pipelines from Myanmar to bring down energy costs: China

BEIJING: The $2.5 billion China-Myanmar oil and gas pipelines, which are nearing completion, will significantly reduce the cost of China's energy imports and overcome the country's dependence on the Strait of Malacca, controlled by the United States, Chinese experts have said.


"China's energy security will be further guaranteed by the exploration of the new import route through Myanmar, and the energy importing channels will be further diversified," Xu Liping, deputy director of China's Center for South Asian Studies, said.

Oil and natural gas from the Middle East and Africa will be transported by way of the Indian Ocean and the pipelines to China's vast inland, without detouring through the Strait of Malacca in Southeast Asia, which is controlled by the United States, he told state-run China Daily.

After three years of construction, the 800-kilometer China-Myanmar natural gas pipeline is expected to undergo test runs soon, and the oil pipeline will be completed in two to three months, Xinhua news agency reported.

The project between China National Petroleum Corporation and Myanma Oil and Gas Enterprise also included the construction of a headquarters in Mandalay.

The $2.5 billion project marks the fourth-biggest channel of China's energy imports after the Central Asian pipelines, China-Russia pipelines and the maritime lanes.

Experts estimate that the pipelines will satisfy a quarter of China's natural gas demand every year, and also bring about $1.5 billion foreign exchange earnings to Myanmar annually, and it is a win-win cooperation between the two countries.

Zhou Dadi, vice-chairman of the National Energy Advisory Committee, called the pipelines a "reasonable energy arrangement", saying that the project could reduce the cost of energy transportation.

"It will especially fulfill the energy demands of Southwest China," Zhou said.

The project was conceived when Myanmar was under military junta when China had a great influence but subsequently Naypyidaw opened up to US and the rest of world denting Beijing's hold there.

Xu said that ties between China and Myanmar will be greatly strengthened due to this project, as the two neighbours rely on each other in many aspects.

The China-Myanmar oil and natural gas pipelines, running parallel inside Myanmar, start near Kyaukphyu of Rakhine State, run through Mandalay, Lashio, and Muse before entering China at the border city of Ruili in Yunnan province.

The two pipelines separate at Anshun, Guizhou province, with the oil pipeline going to Changshou, Chongqing, while the gas pipeline extends to Guigang, Guangxi Zhuang autonomous region.

The designed annual capacity is 22 million tons for the oil pipelines and 12 billion cubic meters for the gas pipelines.