• China's Oil and Natural Gas Needs

China's Oil and Natural Gas Needs (Photo : Getty Images)

China is now interested in importing more U.S. crude oil and natural gas as well as join in the U.S.'s growing liquefied natural gas export industry, according to Wang Yilin, chairman of China National Petroleum Corp. (CNPC).

Wang said in an interview with Bloomberg on Sunday, May 14, that the country is also set to sign deals worth $20 billion with other countries during the Belt and Road Forum in Beijing.

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"The U.S. has very rich oil and gas resources, and as China pursues a diversification of its crude supply, the U.S. will, of course, be one of the sources," Wang said. "We will consider exploring cooperation in areas such as jointly developing liquefied natural gas facilities and gas transport."

Wang said that the country's move to tap into U.S. energy is a step beyond plans in Xi's Belt and Road initiative. The U.S. announced on Thursday, May 11, that it welcomes China to engage in long-term contracts with American LNG suppliers.

Wang added that CNPC has more than 50 joint projects with 19 countries currently participating in the Belt and Road initiative. The company is focused on natural gas in Russia and Central Asia, while in African and Middle East countries most of its projects involved oil.

China is now the largest buyer of U.S. crude and the world's biggest oil importer. Oil production dropped as state-owned companies reduced their spending, which drove China to increase reliance on crude imports.

The International Energy Agency said that China may not be able to completely halt crude production despite efforts by its oil giants to increase their spending while the country shifts to natural gas. In the first quarter, production fell 6.8 percent, while imports increased more than 12 percent in the first four months.

"We need to speed up our cooperation with resource countries to develop assets to meet China's growing need for oil and gas," Wang said. "By doing this, we can balance the higher reliance on imports with better use of foreign assets."

CNPC said that the $20 billion worth of deals that will be signed in the forum include giving Saudi Arabian Oil Co. a stake in the company's Yunnan refinery, a $4 billion agreement for a natural gas processing plant in Azerbaijan with the State Oil Co. of Azerbaijan, gas storage and gas-fired power projects with Russia's Gazprom PJSC, and a geothermal project in Kenya.