China needs new technologies and more diverse sources of energy to ensure adequate, sustainable power for its booming economy -- a challenge offering new opportunities for foreign investment and cooperation.
SHANGHAI, China — China needs new technologies and more diverse sources of energy to ensure adequate, sustainable power for its booming economy -- a challenge offering new opportunities for foreign investment and cooperation, Chinese and European officials said Monday.
"It's already clear that China has to fully use opportunities to expand international cooperation," Ma Songde, a vice minister of science and technology, said in an address to a conference on energy cooperation with the European Union. He added that Beijing is keen to bring in new, clean energy technologies.
Ma and EU Energy Commissioner Andris Piebalgs signed an agreement Monday on developing techniques to capture carbon dioxide from coal burning power plants, which supply more than two-thirds of China's electricity, and store it underground to prevent it polluting the air. Emissions from those plants are viewed as a growing risk for global warming.
The agreement signed between the EU and China on Monday is one of more than 100 joint EU-China research projects on science and technology, many of which are focused on enhancing energy efficiency, reducing pollution and promoting use of renewable energy, such as wind and solar power.
"We need to employ more high-level technologies. By developing these technologies, we can resolve issues restricting growth and enhance growth," Ma said.
China, seeking oil and gas to fuel its booming economy amid stagnant production at home, has been snapping up energy resources in places as far flung as Venezuela, Kazakhstan, Nigeria and Australia.
At the same time, it is focusing on reducing waste and improving the safety and security of its own energy-related industries. Premier Wen Jiabao recently announced China intends to raise its energy efficiency by 20 percent by 2010.
Xavier Chen, an executive with Britain's BP PLC speaking on behalf of a local European Chamber of Commerce committee on energy, urged China to amend policies favoring domestic companies to encourage more foreign investment in natural gas and renewable energy industries.
As a national policy, China has retained government control over industries viewed as strategically vital, such as energy. But foreign companies will be reluctant to invest if they can't win equal treatment and be assured of a steady market and stable operating environment, Chen said.
China's need for more oil and gas exploration and development is bound to continue as the country diversifies its sources of oil and gas, said Liu Keyu, vice president of China National Petroleum Corp.'s Institute of Economics & Technology.
China imports 95 percent of its oil by sea and hopes to build up land-based supply systems as well, Liu said.
He noted that recent overseas acquisitions, such as CNPC's purchase of PetroKazakhstan, are a part of that strategy.
"We need very large oil exploration every year," Liu said, forecasting growing gaps between supply and demand. "We also need to accelerate development and exploration of gas fields."
The EU's energy commissioner said the grouping shares Beijing's concerns about the need to diversify energy sources.
"Despite some improvements in efficiency, major oil discoveries are becoming rarer and rarer," Piebalgs said. "Under-investment has led to a tightening of the market and higher oil prices that can undermine economic growth," he said.
The sense of vulnerability was heightened by disruptions to natural gas supplies during a recent dispute between Russia and Ukraine, said Austria's ambassador to China, Hans Dietmar Schweisgut.
"It has become painfully clear to all of us we need a sharper focus on energy security," Schweisgut said.
Source: Associated Press
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