China National Petroleum Corp. plans to expand its refining operations by 50 percent in oil-rich Xinjiang to help accelerate economic development in the region struck by the deadliest ethnic violence in decades last year.
The country’s biggest oil producer known as CNPC aims to boost its crude processing capacity in Xinjiang to 30 million metric tons a year, the company said in a statement on its website today, citing comments by its president, Jiang Jiemin, during a meeting with the central government this week.
“CNPC will increase oil and gas development in Xinjiang and contribute to the region’s stability and national unity,” Jiang said.
The government in Beijing is pushing for more investment in Xinjiang, holder of China’s second-biggest oil and gas reserves, after riots in poorer regions, including Tibet, left hundreds dead in the past two years. Xinjiang will be the first province to start reform of resource taxes with a shift to taxing raw materials including crude oil and gases by price rather than volume, Jiang said yesterday.
CNPC will increase spending in Xinjiang in the next 10 years after investing more than 300 billion yuan ($44 billion) in the western region over the last three decades, the company said in the statement.
The parent of Hong Kong-listed PetroChina Co. plans to turn Xinjiang into the country’s largest oil and gas production base. Annual capacity will rise to about 50 million tons of oil equivalent by 2015 and more than 60 million tons by 2020, CNPC said. The company will also speed up the construction of emergency oil stockpiles and pipelines in the region.
CNPC is currently capable of producing 18 million tons of oil a year and 23 billion cubic meters of gas annually in Xinjiang. The company aims to increase its refining capacity in the region to 26 million tons a year by 2015.
