Chinese oil giant CNOOC looks underground to store fuel reserves
- Company has started building below-ground facility in Ningbo that promises to be cheaper to construct and operate
- Project is expected to be completed by 2026 and help stabilise supply in the country’s east and along the Yangtze River
State news agency Xinhua reported on Sunday that the Daxie commercial oil reserve project in Ningbo, Zhejiang province, would be the first commercial facility of its kind in the country and more cost-efficient than traditional methods.
Once completed, the water-sealed cavern system excavated in a fractured rock below groundwater level will be able to store 3 million cubic metres, or about 2.5 million tonnes.
Online news outlet The Paper reported the cost of the project to be roughly 3 billion yuan (US$42 million).
The project by state-owned China National Offshore Oil Corporation (CNOOC) will be 20 per cent cheaper to build and cost half as much to operate compared to above-ground oil storage facilities, according to the Xinhua report.
Other storage and transport facilities will be built above ground and construction is expected to be completed and operations begin by 2026.
