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Gas project to be finished by year end China's lengthened east-west gas pipeline may be finished by the end of 2004, one year ahead of schedule. The project's major operator, PetroChina, has signed gas supply contracts with 20 users in Henan, Anhui, Jiangsu and Zhejiang provinces, as well as Shanghai that will use up to 6.7 billion cubic metres of gas, said Zhang Guobao, vice-minister of the National Development and Reform Commission. Zhang spoke Monday at a press conference during the ongoing 10-day session of the National People's Congress (NPC). He said PetroChina, the nation's largest oil and gas producer, is still seeking foreign exploration partners. "It has many contacts with many potential foreign partners but they have not reached any agreements so far," said Zhang. The US$5.2 billion pipeline will transport natural gas from remote Northwest China's Xinjiang Uygur Autonomous Region to Shanghai. It is part of the government's strategy to promote the economic development of impoverished western regions. "The market demand is more than satisfactory," said Zhang. Official statistics show gas consumption will reach 12 billion cubic metres by 2009. That's the benchmark for the project to break even. Zhang said PetroChina started supplying gas to the eastern section of the pipe at the beginning of this year. The eastern section runs 1,485 kilometres from Jingbian in Northwest China's Shaanxi Province. It winds through six provinces and ends in Shanghai.That section will be supplied by the Changqing gas field in Shaanxi Province until 2005. By then, the 2,525-kilometre-long western section linking the Tarim Basin in Xinjiang to Jingbian in Shaanxi will be completed and will start to supply gas to Shanghai. As of July this year, Changqing had proven natural gas reserves of 751 billion cubic metres. It can produce 4.8 billion cubic metres of natural gas a year. As for Tarim Basin, Zhang said the area had proven natural gas reserves of 650 billion cubic metres by the end of last year. At Monday's press conference, the commission's minister Ma Kai warned China's sizzling economy is facing a boom-or-slump juncture which needs skillful control. "We must carefully manage the fast economic growth or we will risk 'boom and bust' swings," said Ma. Ma's comments echoed Premier Wen Jiabao's, who opened the session and announced a growth target of 7 per cent for 2004, down from last year's rate of 9.1 per cent. Ma based his warning on last year's fast growth of investment and money supply last year, which could fuel inflation and financial problems. He said investment growth in steel, aluminum and cement last year grew with "astonishing speeds." Growth in each industry was 96.6 per cent, 92.6 per cent and 120 per cent, respectively higher than in 2002. The swelling investment could lead to more loans and financial risks, warned Ma. Meanwhile, there is a possibility of further raw-material price hikes as the investment spree accompanies shortages of power, energy and resources. "If these happen, China will follow the steps of those countries in Latin America," said Ma. Countries such as Chile and Argentina saw economic booms in 1960s and 1970s but slumped into recession in 1980s due to too much foreign investment and loans followed by vicious inflation. But Ma was confident China can maintain stable growth with its blueprint for balanced development and reined in macroeconomic control. |
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