In regions such as Asia-Pacific (APAC) where rail and road infrastructure is often overburdened, pipelines are an essential means of optimising distribution costs and moving supplies from production centers to domestic and international consumers. China and India are now leading the APAC countries in terms of active and planned oil and gas pipeline length additions, respectively, as they look to develop improved trade routes, says a new report from research and consulting firm GlobalData.
According to the company’s latest report*, China has the largest network of active pipelines in the APAC region, with lengths totaling 34 526 miles, followed by India. On the other hand, India boasts the highest number of planned pipelines ahead of China, with its aim to add 12 722 miles by 2020. This accounts for over 34% of the APAC region’s planned additional pipeline length during this period.
Carmine Rositano, GlobalData’s Managing Analyst covering Downstream Oil & Gas, says: “Australia and Caspian Sea area countries are building the necessary infrastructure to export increasing volumes of oil and gas, while China and India’s strategy is to develop internal networks to meet their growing energy demand requirements throughout their country safely and cost-effectively. Pipeline capacity in China is also being developed to provide access to neighboring countries’ energy resources and to shorten its traditional seaborne import trade routes.”
Looking to create shorter routes and reduce port congestion for its oil and gas imports, China plans on building the Myanmar-China Oil and Gwadar-Urumqi pipelines. The Myanmar-China Oil Pipeline would allow China to avoid the Strait of Malacca, a major chokepoint for global marine trade, when importing crude oil from the Middle East and Africa.
According to GlobalData, around 80% of China’s seaborne crude oil imports pass through this route, and the construction of the Myanmar-China Oil Pipeline would reduce the country’s dependence on the Strait of Malacca by 400 000 bpd, or about 8%.
Meanwhile, India is planning to expand the reach and capacity of its domestic oil and natural gas transmission pipelines network, with a particular focus on gas. GlobalData’s report states that the country is expected to launch 40 gas pipeline operations by 2020, achieving a total length of 12 722 miles, in addition to three new oil pipelines by the end of the same year.
“With a growing emphasis on utilising natural gas, gas pipelines will account for 80% of the entire APAC region’s 125 planned projects by 2020, as key countries look to improve their export capabilities and internal distribution systems,” Rositano concludes.
The full report is available here.
Adapted from a press release by David Bizley
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