CNPC Approves Opening Up of Oil, Gas Pipelines for Third Party Use

State owned China National Petroleum Corp (CNPC) has approved opening up its oil and gas pipeline facilities to third-party use, reports China Daily.

Quoting from a statement by CNPC, the newspaper says the company approved a document covering the opening of its oil and gas pipeline facilities to third-party use, a move in accordance with the nation's energy reform.

Chairman Zhou Jiping said allowing third parties to use these facilities will increase the efficiency of the industry.

The company's natural gas and pipeline subsidiaries are making preparations for the move, China Daily adds.

China’s oil and gas industry is dominated by state owned firms and the country is taking concrete steps to break the monopoly.

Taking pipeline assets away from the total control of PetroChina will help boost the market, especially for small and mid-sized gas producers that don't have pipelines, an industry observer told China Daily.

PetroChina, the listed arm of CNPC, is the biggest pipeline network operator in China. It owns about 70 percent of the country's crude pipelines and up to 90 percent of the natural gas pipelines.

Last month, PetroChina said that it plans to establish a wholly owned subsidiary, PetroChina Eastern Pipelines and will subsequently transfer its 100% equity interest in the subsidiary to rope in private investors.

Eastern Pipelines will contain assets from the first and second phase of PetroChina’s West-East pipeline.

“The equity transfer will help the company develop the mixed ownership model, optimize the resource allocation and financing structure and diversify the ownership structure of the company,” the company stated.