The 962-km long pipeline has been constructed under a 50-50 joint venture between state companies China National Petroleum Corp (CNPC) and KazMunaiGaz. Construction of the project began in September 2004.
The first phase of the Alataw Pass to Dushanzi pipeline, with a total investment of about $130m, has a designed annual oil transmission capacity of 10 million tons; the second phase is expected to be completed in 2010, creating an annual transmission capacity of 20 million tons and a maximum capacity of 50 million tons.
With the completion and operation of the pipeline, the CNPC plans to turn Dushanzi into the largest petrochemical plant in West China, said a senior official with the company. The current 6 million tons of oil refining capacity will be expanded to 10 million, and 220,000 tons of ethylene production capacity are going to be expanded into one million tons, he said. Oil from Kazakhstan will be refined in the plant and transmitted to China’s energy-thirsty east. The Chinese state company now has three exploration projects, four oilfields, and two pipeline projects in Kazakhstan. It acquired PetroKazakhstan Inc in October, laying a basis for the oil supply of the pipeline.