China needs to build up its tanker fleet

Experts in China have called on the government to support the expansion of a domestic tanker fleet to cater for burgeoning oil imports. As China becomes a large net oil importer, experts say building the country’s own oil tanker fleet to ensure oil security in the future is an urgent task.

The fleet should be capable of handling at least 50% of China’s total oil imports and, based on this estimation, the oil tanker fleet should be able to handle 75 million tonnes of the oil imports by the year 2010. The figure would rise to more than 130 million tonnes by 2020. Currently, the majority of China?s oil tankers is on average six years older than those of other countries and are small in size with none able to carry more than 100,000 tonnes of oil.

Meanwhile, China’s two largest oil importers, the China Petro-Chemical Corp. and the China National Petroleum Corp, do not own any tankers and, during the past couple of years, only 10% of the China?s oil imports was shipped on domestic tankers. Although the government has worked on building up strategic oil reserves, the work to build a large tanker fleet has been overlooked, according to Yao Ping, deputy general manager of the China Yangtze River Navigation Group. He cited Japan and Korea as examples, saying that the former has large tanker fleet with a total tonnage of 20 million tonnes which can ship 80% of the country?s oil requirements while the Korean tanker fleet carries a total of 6.6 million tonnes or 30% of the country’s total oil imports.

According to the report, COSCO Group, the China National Offshore Oil Corp and the China Yangtze River Navigation Group have worked out policies concerning the construction of an oil tanker fleet but the government still has no concrete plans to support the development of this sector.

The International Energy Agency forecast that China would import 150 million tonnes annually by 2010, and 250 million tonnes by 2020.