PetroChina, China’s largest oil producer, has received approval from the Ministry of Commerce for its proposed Rmb6.6bn investment to build a liquefied natural gas (LNG) terminal in Jiangsu province, Shanghai Securities News reported.

The project, a joint venture involving PetroChina, Hong Kong-based Pacific Oil & Gas and Jiangsu Guoxin Investment Group, is expected to begin by the end of April 2011. It will be situated on West Taiyangsha artificial island off the coast of Jiangsu.

The terminal will import LNG from Qatar, Australia and the Chinese city of Dalian, and is expected to produce 3.5m tons of natural gas a year, eventually rising to 6.5m tons annually.

In a separate development, PetroChina was reported to be seeking a partner to offer crude oil for a proposed Rmb15bn refinery in a chemical industrial park in Chongqing’s Changshou district.

Wang Yilin, vice general manager of PetroChina's parent, China National Petroleum Corporation, said that the new refinery would produce 6.5m tons of refined oil a year. It was not made clear when the refinery will open.

China’s oil producers are building more LNG plants as the country tries to reduce emissions by increasing gas consumption to 9 per cent of total energy use from the current 3 per cent. Most of the large refineries are located in northeast and northwest areas, so the Chongqing facility will help ease the supply shortage in the southwest area.