PetroChina plans to establish a wholly owned subsidiary, PetroChina Eastern Pipelines (“Eastern Pipelines”), that would group the First and the Second West-East Gas Pipelines. The subsidiary would have total assets amounting to Cyu 81.7bn (US$13.1bn). PetroChina would subsequently transfer its 100% equity interest in Eastern Pipelines through a public tender at an equity exchange. Upon completion of the transfer, the Company will cease to hold any interest in Eastern Pipelines.
The West-East gas pipelines stretch over more than 4,000 km. The capacity of the first one was raised from 12 bcm/year to 17 bcm/year in 2011. The second pipeline (Turkmenistan-Xinjiang-Shanghai), with a capacity of 30 bcm/year, was commissioned in January 2013. The third pipeline, which also has a capacity of 30 bcm/year and connects the Tarim basin (Xinjiang/Uygur) and Fujian to the east coast via Sichuan, should be commissioned by CNPC in 2014; in June 2012 the project was opened to private investors, in an attempt to attract capital for 46% of the project. The fourth and fifth pipelines could be built after 2015.
PetroChina already divested part of its gas pipelines assets in 2013, as the group is seeking to cut its capital spendings and to boost shareholder returns amidst a massive corruption probe.
Source: China Daily