Kazakhstan set to open oil pipeline to China

Kazakhstan is due to open the valves Thursday on a major pipeline carrying oil to fuel-hungry China, establishing the energy-rich former Soviet republic's first oil export route that bypasses Russia. For the vast Central Asian nation, which is expected to become one of the world's largest oil exporters, the 1,000-kilometer (625-mile) pipeline opens a huge market. It is designed to carry 20 million tons (140 million barrels) of oil annually to China.

For China, the new route is a key achievement in aggressive efforts to secure foreign energy supplies for its booming economy. The pipeline is a 50-50 joint venture between state companies China National Petroleum Corp. and KazMunaiGaz.

Kazakh President Nursultan Nazarbayev is expected to push a button at KazMunaiGaz headquarters in the capital, Astana, to open the flow from the pipeline that starts in the central town of Atasu, 280 kilometers (174 miles) to the south. Kamal Burkhanov, director of the China and Russia Institute in Almaty, said it was "hard to overestimate" the importance of the new pipeline.

"By launching this pipeline, Kazakhstan fulfills its geopolitical strategy of a multi-vector policy," he said. "Kazakhstan will now be able to sell its oil to markets of its own choice, independent of political pressure."

Nazarbayev, who has skillfully maneuvered between the interests of his two giant neighbors, Russia and China, pledged after the announcement of his re-election to a new seven-year term this month to stick to his "multipolar policy" in foreign affairs. "Kazakhstan's pipelines are an indication of that," Nazarbayev said.

Kazakhstan, which possesses the largest oil deposits in the energy-rich Caspian Sea, currently produces about 1.3 million barrels a day, according to the Oil Ministry. By 2015 its oil output is expected to reach 3 billion barrels a day, or 150 million metric tons a year. Until now, the main route for Kazakh oil exports has been the Caspian Pipeline, which was launched in 2001 to join the giant Tengiz oil field in western Kazakhstan with Russia's Black Sea port of Novorossiisk. In 2004, it transported 22 million tons of crude, but is planned to be expanded to a capacity of 68 million tons per year. The launch of the Chinese pipeline comes months after the opening of another alternative export route for Kazakh oil, the 1,760-kilometer (1,100-mile) pipeline that runs from the Azerbaijani port capital of Baku, via Georgia to the Turkish Mediterranean port of Ceyhan. Kazakh Prime Minister Daniyal Akhmetov has said Kazakhstan could ship up to 30 million metric tons of oil (8.8 billion gallons) yearly through the U.S.-backed pipeline that opened in May, but no deal has yet been signed.

In addition, during a visit to Ukraine last month, Nazarbayev said Kazakhstan was ready to take part in construction of Ukraine's Odessa-Brody pipeline and in extending it to the Polish Baltic Sea port of Gdansk. The pipeline links the Black Sea port of Odessa with Brody on the Ukrainian-Polish border and could allow Kazakh oil to reach the Baltic states.

For Beijing, the launch of the new pipeline that runs to the Altaw Pass in northwestern China is part of a strategy aimed to satisfy its growing appetite for energy by tapping the reserves of neighboring Central Asian nations.

Earlier this year, CNPC bought Kazakhstan's third-biggest oil producer, Canada-based PetroKazakhstan, whose energy assets are all in Kazakhstan and include one of the country's three oil refineries. China also signed gas exploration contracts in Uzbekistan, and it is expected to sign a major natural gas supply deal with Turkmenistan in January, reports the AP. I.L.