Daqing Petroleum & Chemical Co, a unit of PetroChina, will begin expanding its ethylene production facilities this month, PetroChina's parent, China National Petroleum Corp, said.

It said the expansion will double Daqing Petroleum's output of ethylene to 1.2 million tons per year, making it the country's largest producer of the gas, which is derived from natural gas and petroleum and used as a source of many organic compounds, in welding and in cutting metal.

The company did not say when the project is due for completion.

Currently the country's largest producer of ethylene is the Maoming refinery, owned by Sinopec. Its ethylene capacity is 1 million tons per year.

Daqing Petroleum's expansion plans were approved in June by the National Development and Reform Commission.

Its Daqing field was first tapped in 1960 and accounted for around one-third of the country's oil production in 2002, but output has declined steadily in recent years.

PetroChina said the field produced 43.4 million tons of crude oil in 2006, versus 44.95 million in 2005.