CHINA May Build 5th Strategig Reserve

China may build a fifth strategic oil reserve in Lanzhou in the northwestern province of Gansu to store crude from Kazakhstan, state media said Wednesday, citing an unnamed industry insider.

"It will be filled by crude imported from Kazakhstan through China National Petroleum Corp's oil pipelines across northwestern China," said an advisor to the largest oil producer in China, according to the Shanghai Securities News.

The newspaper said Gansu will build a 10-million-tonne oil reserve, the largest ever in China and part of the country's Phase-II strategic oil reserve programme, to stock both crude and oil products. An oil pipeline between the Atasu fields in central Kazakhstan and Alashanku in western China started operating in mid-2006, with a designed annual delivery capacity of up to 20 million tonnes by 2010.

The Gansu base will also store oil produced in northwest China's Xinjiang region, the report added.

China National Petroleum Corp has completed a 1,859-kilometre (1,153-miles) pipeline from Urumqi in Xinjiang to Lanzhou.

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