China Selects GE Compression Technology for 2nd West-to-East Pipeline

One of China's most important infrastructure projects of the 21st century will once again rely on GE Oil & Gas technology. Chinese President Hu Jintao has called the project "of strategic significance" and noted it will help "optimize the country's energy structure and maintain energy security".

In a contract exceeding $100 million, GE Oil & Gas will be supplying pipeline compression equipment for China's second West-to-East natural gas transmission pipeline. In 2005, GE was also selected as an equipment supplier for the expansion of China's first West-to-East pipeline, the country's main energy artery and one of the largest gas projects in the world.

The second West-to-East pipeline will carry natural gas from Turkmenistan to Shanghai and southern Guandong Province, to help meet the region's growing energy demand. The new pipeline will run more than 9,000 kilometers, will traverse 12 provinces and autonomous regions and will have a designed gas transmission capacity of 30 billion cubic meters annually.

The pipeline is owned by PetroChina Company Limited, China's leading oil and gas producer and distributor.

According to the official Chinese government Web portal, the second West-to-East pipeline marks the first time China has launched a project to pipe natural gas from a foreign country. Construction of the new pipeline, which consists of a main line and eight sub-lines, began earlier this year. The pipeline is a vital component of China's plan to increase the use of cleaner fuels to meet the country's enormous energy needs.

GE Oil & Gas will supply seven gas turbine-driven pipeline compression units for the first phase of the second West-to-East pipeline. The units will be installed at two new boosting stations in Xinjiang and Gansu provinces and will feature 30-megawatt, PGT25+ gas turbines driving PCL 800 pipeline compressors.

"GE Oil & Gas has been active in China for more than 30 years. Traditionally, we have had a strong presence in the downstream (refineries, petrochemical plants) sector of China's oil and gas business. With the greater demand for natural gas transmission, underscored by projects like the two West-to-East pipelines, we also have become a major supplier of pipeline compression equipment in the country," said Claudi Santiago, president and CEO of GE Oil & Gas.

Due to extremely cold weather at the compressor station sites and the tight construction schedule, on-time and complete delivery of the equipment is critical to the success of the project. The turbocompressor units will be built primarily at GE facilities in Florence, Italy and Cincinnati, Ohio and delivered to the project sites in March of 2009, with commercial service expected by the end of 2009.

GE is redesigning the packaging of the turbocompressor units and will implement simplified installation and commissioning procedures to reduce installation time and customer site activities. GE's centrifugal compressor impellers offer higher efficiency over a large operating range, which helps to reduce fuel costs over the life of the equipment.

In addition to the supply of the equipment, the GE Oil & Gas contract also includes site installation and commissioning services and spare parts for start-up and operation. GE Energy is supplying the control systems and its aeroderivative business will provide the gas generators for the turbines.

As part of GE's overall growth strategy in China, the second West-to-East pipeline further expands the presence of GE Oil & Gas technology in China. Recent examples include the supply of equipment for the Sichuan to East China pipeline, and the supply of compressor trains for two milestone projects in China that will feature the world's largest coal-based propylene plants.