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Ambassador to U.S. says China needs more oil and gas

Posted: Thursday, October 05, 2000

ANCHORAGE (AP) -- China will be looking to Alaska to provide more oil and gas as the Asian country's economy grows, the Chinese ambassador to the United States said Wednesday.

A decade ago China could meet its own energy needs, said Ambassador Li Zhaoxing, but that's no longer the case.

''China has already become an oil-importing country,'' he said. ''Alaska really has a strong edge here.... We do need to import oil and natural gas.''

Li, in his first visit to Anchorage, spoke to about 150 people gathered at a downtown hotel for an Alaska World Affairs Council event.

During his two-day Alaska visit, Li will tour the North Slope to get a better look at BP Exploration (Alaska) Inc.'s operations there, said David F. MacDowell, director of External Affairs-Gas Alaska for BP.

Earlier this year, London-based BP Amoco announced it planned to form a joint venture with PetroChina Co., a unit of the state-owned China National Petroleum Corp., to market natural gas in eastern China.

The companies also said they would build or buy gas stations, and might expand into aviation fuels.

Natural gas meets just 2 percent of China's energy needs, but the government wants to increase that to 7 percent to 8 percent by 2010.

China is Alaska's fourth largest trade partner, said Greg Wolf, director of the state Division of International Trade & Market Development, who introduced Li.

Alaska's exports to China over the last five years have topped $100 million a year, although the export total dropped the last two years from a peak of $213 million in 1997. Last year, oil and gas accounted for 51 percent of exports and seafood 44 percent.

Gov. Tony Knowles is planning a trade mission to China later this month, Wolf said. The U.S. Senate last month approved permanent normal trade ties with China, opening the way for China's likely entry into the World Trade Organization.

Wolf said that's good news for Alaska, because it will mean lower tariffs and greater access to markets. Alaska, a resource-rich state with expertise in oil and gas development, has what China needs, he said.

China's interest goes beyond oil, gas and seafood, Wolf said. Chinese officials visited Fairbanks in July to discuss increasing trade in agricultural products. China is particularly interested in Alaska's disease-free seed potatoes.

Three inspectors from Beijing visited the state for a pre-export clearance inspection last month. Now, Alaska is waiting to hear back, Wolf said.

Li's appearance was sponsored by BP Exploration (Alaska) Inc., Northwest Airlines and Alaska Airlines.



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