China began construction of a 5.4 million cubic meter strategic oil reserve in the western Xinjiang region to improve national energy security, state media reported. Located in Dushanzi, Karamay City, the project is part of China’s second development phase of its strategic oil reserve base, with a capacity of 26.8 million cubic meters. PetroChina vice president Sun Longde said construction of the first phase of the reserve base, which has a capacity of 3 million cubic meters, is expected to be finished in October 2010. The first phase cost US$388 million to construct. The reserve will be supplied with crude from neighboring Kazakhstan and Russia. China plans to build oil reserves equivalent to 100 days of imports by 2020.