Sinopec to ship Puguang gas to S China

China's top policy planner, National Development and Reform Commission, has approved Sinopec (NYSE:SNP) to transfer Puguang gas in Sichuan to the Pearl River Delta, according to reports by China Daily.

With more new discoveries reported in Puguang gas field, Sinopec has ability to supply natural gas to the Yangtze River Delta and the Pearl River Delta at the same, officials of Sinopec said.

After a pipeline is built in 2009, the new pipeline might ship gas to Guangdong, Hong Kong and Macao Area, the officials said.

Meanwhile, PetroChina (NYSE:PTR) is also mulling a pipeline from Xinjiang to Guangdong province and linking up with its West-East pipeline. But the firm declined to disclose more. According to Guangdong provincial government plan, it will build gas network with a designed capacity of 10 million ton/year during 2006-10, and increase local gasification ratio to 50 percent.

Sinopec officials said they are confident to find enough gas to support gas supply to both east and south China markets. Guangdong-based energy experts say the south China market has the potential to absorb the gas from Sichuan, aside from the LNG supply by CNOOC.