The first crude oil flowed through the 962-kilometer pipeline across the Alataw pass and into China late on July 11, Xinhua said.
The $700 million pipeline was built by the state-owned China National Petroleum Corp. and Kazakhstan's KazMunaiGaz. The project -- which envisages a capacity of 20 million tons per year -- also calls for an extension of the pipeline by 252-kilometer section to connect the current terminal with a refinery at China's Dushanzi refinery.
Chinese officials expect to import nearly 5 million tons of Kazakh oil this year, rising to about 8 million tons in 2007, according to ITAR-TASS.
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Russia's rising appetite for Central Asian gas is a direct result of the shifting fortunes of Gazprom, the state-run Russian company that controls lucrative exports. The company's total gas production has flatlined at around 550 billion cubic meters (bcm) a year. With major fields yielding less as they age, Gazprom has chosen to maintain its all-important gas balance by purchasing gas on the side -- from independent producers in Russia and from Russia's Central Asian neighbors -- instead of investing in the lengthy and costly development of untapped Arctic fields...(more)