Hey George,
That's cool. Here a little ditty from RB:
THIS ARTICLE CAN ONLY BE A PLUS:
Came across this article and thought it could only help us!!
Ray
PETROLEUM
Mainland's crude oil imports rising
Aug 16 2000 9:45AM
China's imports of crude oil this year are expected to rise to more than 60 million tons. Earlier forecasts had put the figure at 50 million tons, today's China Daily reported.
The increase will place added pressure on the central government to make an early decision on the critical issue of a state oil reserve.
A total of 32.41 million tons of crude oil were imported in the first half of the year, according to the latest statistics.
Calls for a quick decision on the state crude reserve are sounding stronger in the light of the anticipated increase. Government energy officials, experts and corporate executives are among the voices calling for the reserve.
A four-year-long feasibility study on the state reserve was recently submitted to the State Development Planning Commission. An official from China International Engineering Consultative Corporation revealed this development to China Daily.
The official from the government-run corporation, which prepared the report, said she believed the domestic supply shortfall would force the country to import more crude in the remaining months of the year.
China's imports of crude oil have increased consecutively over the past seven years. The climb is anticipated to continue to push yearly imports up to 100 million tons within a decade.
Pressure has apparently been building on the central government not to delay any more the making of decision on the urgent state reserve, said the official, who played a major role in the feasibility study.
The state reserve's possible size was discussed during the study, said the official, who declined to be identified.
The United States, the world's largest oil consumer, and Japan, the world's second economic power, both have State reserves for emergency purposes.
The world's seventh largest oil producer, China pumped 160 million tons of oil last year. That said, it would not be likely to build a State reserve of the size of the United States or Japan, the official noted.
The study group, which embraced many leading experts and scholars, agreed that decisions on size can only be reached through a step-by-step strategy.
China might not be able to afford a very large state reserve, the official said. Even a small reserve for nationwide use would be a heavy cost burden.
She pointed out that conditions in China are different from those in the United States and Japan. The size of a reserve should be affordable to the country's treasury.
The official implied that China's crude reserve would probably be composed of a national storage under the State budget and inventory at oil firms.
However, the State reserve can only be financed by the government.
The report proposed existing facilities such as unloading equipment and storage tanks at deep-water harbors be used for the State reserve in its initial phase.
That implies existing facilities, under administration of several sectors, would be embraced in the strategic program, or the state reserve system.
The official admitted that the existing storage facilities in the country can only help maintain inventory for petrochemical production.
The official ruled out the possibility that the State reserve be often used to offset minor market fluctuations.
Despite the fact that it has been a net oil importer since 1993 and the dependence on imports to fill the demand-supply gap on its home market is growing heavier, China has little state-level crude reserve.
The Chinese have debated the necessity for a state crude reserve for about a decade.
Because of the rigid regime on licensing and quota controls over imports, the country could not buy more crude from the international market when oil was priced low there.
Many government departments and industrial sectors would be involved in preparing and actually establishing the long-awaited State crude reserve, the official said.
She did not elaborate on this matter. "Certainly, establishing a state reserve has been on the central government's agenda," she said.
The official, who make surveys in many major oil developing and trading firms, said executives, managers and even workers at the firms were "greatly concerned" about the country's regime on oil imports.
Some experts criticized the government for not considering and taking action for the state reserve earlier.
"We let go chances for buying cheap oil from the world market when it was priced low, at say US$20 a barrel," one expert said.
Besides its requirement on the State revenue, the need for a state reserve will also pose stern challenge to the country's licensing and quota system on oil imports.
China may have to adjust its policies to suit a new trade environment after it enters the World Trade Organization. This was noted by Xiong Shaohui, head of the import division of the trade management department of the Ministry of Foreign Trade and Economic Cooperation.
At a recent oil trade conference in Guangzhou, Xiong urged that the government should manage oil imports mainly by employing market economic rules and international conventions.
chinaweb.com
Hang in,
John :-)
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