Energy security has been a priority for the Chinese government since the early 1990s, when it began an economic gallop and became a net oil importer. China overtook the U.S. as the world's largest overall energy consumer in 2009, with coal accounting for the biggest share.
However, the share of oil and natural gas in the country's energy mix continues to grow because of rising demand for refined oil products, such as petrochemicals that serve as the building blocks of industry as well as gasoline for vehicles—about 55,000 new cars roll onto China's roads every day. In December, net oil imports exceeded those of the U.S. for the first time, and China's ascent as the world's biggest importer could become permanent as early as next year.
While the country's import dependency has prompted its state-owned energy firms to search for oil in faraway regions such as Africa, South America and the Middle East, it still faces a daunting challenge in getting that oil to its shores. Last year, the lion's share of China's total oil imports—about 4 million barrels a day out of 5.43 million barrels—was shipped through the narrow Strait of Malacca, near Singapore, where the U.S. Navy has a strong presence, and through the South China Sea, where territorial disputes with Southeast Asian neighbors have intensified as China has grown increasingly assertive. The two pipelines through these dusty highlands in Myanmar are crucial to Beijing's efforts to diversify its energy-supply routes.
China's twin pipelines stretch 800 kilometers from the Indian Ocean to the Chinese border, where they will supply oil and gas for China's rising energy needs.
"The way the Chinese have been able to develop their energy oil import infrastructure in recent years has been hugely impressive," said Richard Gorry, an analyst at consultancy JBC Energy. "When you're an economic powerhouse like China, you want to make sure you're not held hostage to potential supply disruptions in the Malacca Strait or South China Sea."