Mizzima News

New Delhi - China is set to commence construction in the first half of 2009 on a giant pipeline project that will connect Sittwe, on the Bay of Bengal in Burma, with China's Yunnan Province.

According to the China Daily newspaper, the China Natural Petroleum Corporation, with a 50.9 percent stake in the project, will head the US $2.5 billion pipeline project. The remaining stake will be held by the Myanmar Oil and Gas Enterprise (MOGE).

The project will include the construction of two separate pipelines, a US $1.5 billion oil pipeline and a US $1.4 billion gas pipeline.

Once completed, the pipelines are expected to provide an alternative route for China's crude imports from West Asia and Africa, Mi Gongsheng, Director of the Yunnan Provincial Development and Reform Commission was quoted as saying.

Currently, 80 percent of China's annual crude imports of 200 million tons must pass through the Strait of Malacca, located more than 1,800 kilometers farther to the east than Sittwe.