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Oil region looks to the future

By Li Fangchao (China Daily)
Updated: 2007-03-13 07:04

Daqing, China's largest oil producer is exploring new income opportunities for the region's ongoing sustainability.

Since 1959, Daqing has produced about 1.9 billion tons of crude oil. Notably, during the period 1975 to 2002, Daqing maintained an annual oil production of no less than 50 million tons, creating a world record.

Concerns that Daqing was on the verge of depleting its natural resource stocks surfaced when output began to decline in 2003.

But Gai Ruyin, Party secretary of Daqing Committee of the CPC, brushed aside concerns, saying Daqing's future was more secure since the recent discovery of large oil and gas fields in the region and new "exploitation technology".

"Our goal is to build a 100-year Daqing oilfield," he said. "Even on conservative estimates, Daqing could maintain an oil output of no less than 40 million tons until 2020 and still be the number one taxpayer in China."

Last year, Daqing oilfield produced the equivalent of 45.3 million tons of oil and gas, ranking it first in the country.

There is enough oil stocks to help buy more time for other income alternatives, he said.

"But if we do nothing, we may sooner or later have nothing to rely on," he said.

Gai said the city had mapped out a detailed plan to further develop more non-oil industries, including a series of large-scale chemical projects.

Already home to a 600,000-ton ethylene plant, the city wants to build another one.

Located in Northeast China's Heilongjiang Province, the most important commodity grain base in China, Daqing also wants to become a major food-processing center.

The city wants to produce large amounts oil equipment, textiles and leather products.

Gai said China's plan to unify the corporate income tax at 25 percent for both domestic and foreign companies now tabled for discussion at the ongoing annual session of NPC was positive for Daqing.

The tax for domestic companies used to be 33 percent.

"We will have more money to accelerate the transformation," he said.

(China Daily 03/13/2007 page5)