Chairman of PetroChina: Demonstrating the Establishment Time of National Oil and Gas Pipeline Network Company

 Chairman of PetroChina: Demonstrating the Establishment Time of National Oil and Gas Pipeline Network Company

On March 3, the second session of the 13th CPPCC National Committee was officially opened. At the opening ceremony, the reporter of China Energy Daily exclusively interviewed Wang Yilin, member of the CPPCC National Committee and chairman of China Petroleum Group. Wang Yilin responded one by one to the hot issues such as the establishment progress of the National Oil and Gas Pipeline Company, the circulation of mineral rights within PetroChina and the price of coal-based gas products.

China Energy Daily: At present, how is the progress of the establishment of the National Oil and Gas Pipeline Network Corporation? Can we have a specific timetable? What impact will the establishment of the oil and gas pipeline network company have on the oil and gas industry?

Wang Yilin: The establishment of the company will be carried out in accordance with the unified deployment of petrochemical reform. At present, we are demonstrating the actual time of establishment.

China Energy Daily: One of the priorities of PetroChinas work this year is the internal transfer of mineral rights. After the first batch of pilot projects, what impact will it have on the outflow and inflow areas?

Wang Yilin: Mineral right itself belongs to the state. Orderly circulation of mineral right in accordance with the principle of marketization is conducive to the orderly utilization of mineral resources, which is in line with the development trend of market economy. After the first stage of the pilot project, we believe that it can promote the exploration of mineral resources.

The next stage is to promote the flow of mineral rights. When it does not move, the units that acquire mineral rights do not make some investment, which is not conducive to the exploration and development of mineral rights. Secondly, after circulation, according to the principle of marketization, the companies with the ability and funds should be allowed to acquire mineral rights, and mineral resources should be transformed and developed as soon as possible to benefit the people.

China Energy Daily: At present, the work of converting coal to gas is continuously advancing in our country, but in this process, there are some potential safety hazards. At the same time, the price of coal is higher than that of traditional coal. How to solve these two problems?

Secondly, we should do our best to change the speed of coal to gas, which should be linked to the gas supply capacity, and also consider the users affordability to the price of natural gas. Chinas dependence on natural gas has been around 40%, most of the natural gas purchased from abroad is in accordance with the unified price of the international market. If the price hangs upside down, enterprises are not motivated to import gas, and the demand of users can not be improved.

China Energy Daily: How to maximize user demand on gas sources?

Wang Yilin: As a gas supplier, we have done a lot of preparation work on resources. From the beginning of the year, the Party Central Committee and the State Council put forward clear requirements to strengthen the construction of production, transportation, storage and marketing systems. I think this years resource preparation is quite adequate.

But one of the characteristics of gas utilization in China is that the gap between peak and valley is too big. At the end of last year, Chinas air consumption in winter peaked at 1 billion cubic meters a day. The peak time in Beijing has reached 100 million cubic meters a day, but only 20 million cubic meters at the trough, which poses a great challenge to gas supply.

China Energy Daily: Does PetroChina have a strong voice in the pricing of coal-based natural gas?

Wang Yilin: PetroChinas gas assets account for about 70% of Chinas total. But if we grasp the natural gas resources and pipeline resources, so as to have more voice, let other enterprises have any difficulties in utilizing pipelines, I have not found any similar problems.

Our pipelines are open, and everyone can enter the pipeline at a fair price.

China Energy Daily: What are your suggestions on pricing coal-based gas products?

Wang Yilin: Since 2018, the classification of natural gas in China has been further clarified. One is the control of gas. According to the statistics of each province and city, we must ensure that the peoples livelihood gas consumption part is uniform price for several major gas companies. Controlled gas must be executed at controlled prices.

The other is uncontrolled gas. For example, we do not have more gas resources, but in fact there is an objective demand for gas. We need to go to the international market to buy gas. At this time, we need customers to bear part of the higher price, so that enterprises can not lose money.

The most critical issue in the coal-fired gas industry is the cost. The cost of coal-fired gas should be in line with the market cost, otherwise it will not be sold. Although the State supports coal-to-gas production with a small subsidy for some enterprises, even in this case, I think its cost is still very high, and it has to bear the price pressure of uncontrolled gas.

China Energy Daily: Last year, what did PetroChina do to enhance its exploration and development efforts?

Wang Yilin: We have formulated a plan to enhance exploration and development until 2035, which reflects the overall improvement of the intensity, greater than the 13th Five-Year Plan or even the 14th Five-Year Plan.

Especially in risk exploration. For example, in the past, PetroChina invested about 1 billion yuan in risky exploration every year, which has risen to 5 billion yuan since 2019, a four-fold increase, in order to encourage people to take risks in exploration.

I think only by taking big risks can we make big discoveries. Last years practice has proved that some natural gas resources are still effective through further risk exploration. Whether in the Tarim Basin, Junggar Basin or Sichuan Basin, the discovery of these gas fields proves that our decision to transfer mineral rights and increase risk exploration is correct.