Sinopec's Sichuan-South China Pipeline Approved

China's top economic planner has given Sinopec the nod to build a pipeline from gas-rich Sichuan to South China, a source from Asia's top refiner said yesterday.

"As reserves from Sichuan's Puguang Gasfield prove to be larger than expected, we have been given the greenlight to pipe gas from Sichuan to ... the Pearl River Delta," the Sinopec insider, who didn't want to be named, told China Daily, citing documents approved by the National Development and Reform Commission, the country's top economic planner.

"By the end of 2009, Sinopec may supply natural gas to Guangdong, Hong Kong and Macao," the source added.

Sinopec spokesman Huang Wensheng partly confirmed the news.

"We do have such a plan, but the prerequisite is that there should be enough gas extracted from the Puguang Gasfield (to feed both the Yangtze River and Pearl River Delta area)," Huang said.

Puguang is likely to yield more natural gas than previously estimated, Huang said.

"I cannot tell Puguang's exact reserve potential right now. But our exploration staff are all very confident (that more reserves will be discovered)," he said.

Chen Ge, Sinopec's secretary, had earlier told China Daily that he is confident in Puguang's potential.

Currently, Sinopec's Puguang Gasfield in Sichuan has an estimated exploitable reserve as large as 356 billion cubic meters, the country's second-largest, according to information released by the Ministry of Land and Resources earlier this year.

China's largest current gasfield, the Sulige Gasfield in the Inner Mongolia Autonomous Region, has proven reserves of 533.6 billion cubic meters.

The Sinopec source said that to prepare to feed gas to the Guangdong market, Sinopec has hammered out a partnership with China National Offshore Oil Corporation (CNOOC) and the Guangdong provincial government to jointly weave a gas pipeline network in the economically booming province.