Province talking to domestic and overseas producers in the hope it can host a national strategic petroleum reserve
The Hainan government is in talks with domestic and overseas oil companies to establish an oil stockpile, raising the possibility the island may be used as a base for a national strategic oil reserve, an official says.
Hainan party secretary Wei Liucheng said the province was preparing to build reserve infrastructure and was discussing the project with other parties, including oil companies. The announcement follows news last month that Guangdong plans to build a 5 billion-yuan oil reserve.
The mainland imported 129.88 million tonnes of crude oil last year to meet 47 per cent of its fuel needs. To shield the nation from disruptions to crude supplies and market fluctuations, the government began building four oil storage tanks on the country's east coast in 2003, the first phase in the emergency stockpile plans.
The storage terminals are set to be completed next year.
Several provinces are keen to be selected as the locations for the second phase because of the anticipated boost the investment would give to the local economy, but Beijing has not announced its decision.
'No matter whether it's for a national oil strategic stockpile or a commercial oil reserve base, Hainan is a reasonable and ideal choice,' Mr Wei said during a National People's Congress group meeting.
