Sinopec will not exit pipline project

Sinopec officials denied that the company was planning on pulling out of a US$5.2 billion west-east natural gas pipeline project with PetroChina. Sinopec planned to take a 5% stake in the project according to an agreement made with PetroChina in 2001. The denial came after Sinopec reported a 2004 first half profit increase of 50.5%, to US$1.9 billion. The heads of the two oil firms reportedly held a meeting to discuss Sinopec leaving the project during which PetroChina head Chen Geng reportedly asked Sinopec to drop out to simplify the project's shareholding structure. If Sinopec drops out, it will need to bargain for terms to use the pipeline, scheduled for a trial run in October. It is scheduled to open for business in January, transporting gas from fields it owns in the Xinjiang Uighur Autonomous Region.