RIYADH, April 23: Chinese President Hu Jintao discussed a proposal to set up a Saudi-fed strategic oil reserve in China during a visit that has seen the signing of energy and defence deals, a Chinese official said on Sunday.
The plan was raised during Mr Hu’s talks with King Abdullah on Saturday and both sides want to see it through, the official said.
The reserve would be on top of the oil supplies Saudi Arabia exports to China for its daily needs, which reached 22.18 million tons last year, making Riyadh Beijing’s biggest crude supplier, he said.
The reserve would be set up in a coastal city in south-eastern China, to be used by Beijing in case of emergency.
The official did not say how much oil would eventually be stockpiled. But he said Riyadh and Beijing were discussing the feasibility of the plan and ways of cooperating to carry it out.
Mr Hu toured the headquarters of state oil conglomerate Saudi Aramco in the eastern oil hub of Dhahran on Sunday.
China’s Sinopec is building a refinery with Aramco in the south-eastern Chinese province of Fujian. Another joint refinery venture is planned in Qingdao city.
Saudi Oil Minister Ali al Nuaimi has been accompanying Mr Hu during his meetings.
The Chinese leader arrived in Riyadh on Saturday, just three months after King Abdullah went to China, underlining their fast growing ties as Beijing looks for oil to fuel its growth and Riyadh forges partnerships with Asian powers.
Mr Hu and King Abdullah on Saturday presided over the signing of a series of agreements, including one between Sinopec and Aramco.
The agreement provides for strengthened cooperation in gas exploration and possible cooperation in oil exploration, a Chinese official said.
Sinopec is already drilling for gas in the Saudi desert.
An Aramco statement said the agreement provides for an integrated refining and ethylene project in Fujian to begin production by early 2009.
It also stipulates that the two sides will further efforts to agree on terms for Aramco’s participation in the Qingdao refinery project, which is planned to go on stream in 2008.
The Chinese leader discussed a proposed 5.2-billion-dollar energy venture in China with officials of Saudi petrochemical giant SABIC.
Official Saudi media reported that in addition to signing a security agreement, the two sides inked a ‘contract on defence systems’.
Saudi Arabia, which has traditionally used western defence systems, purchased Chinese Eastwind missiles in the 1980s.
Mr Hu also held meetings with Saudi businessmen, including one with billionaire entrepreneur Prince Alwaleed bin Talal, who said afterwards he had been urged to increase his investments in China, where he is involved in the hotel and banking sectors.
In a speech before the Shura on Sunday, an appointed Saudi advisory body, Mr Hu hammered home the theme of ‘mutually beneficial cooperation’ between the powerhouse nations.
The Chinese president said nations should not be criticised for differing from the West in terms of cultural norms.
Mr Hu warned the differences ‘should not be used as a pretext to hurl false accusations against the internal affairs of other countries, let alone blame a specific civilisation, people or religion for causing problems and conflicts in the world.”
Mr Hu was only the second foreign leader to address the Shura after French President Jacques Chirac, who gave a speech to the all-men body last month.
The Chinese president, who came from the United States, is due to leave for Morocco on Monday and go on to Nigeria and Kenya. —AFP
