In order to build a national grid bureau and promote the reform of the oil and gas pipeline network, on April 25, 2021, the State Pipeline Network Group and the Fujian Provincial Government signed the "Intensification of Cooperation Agreement on the Development and Reform of Natural Gas Pipeline Networks" in Fuzhou. Fujian has also become a successor. After Guangdong, Hainan, Hubei, and Hunan, it is the fifth provincial natural gas pipeline network to be placed under the national pipeline network.

The "Implementation Opinions on the Reform of Oil and Gas Pipeline Network Operation Mechanism" proposes to integrate into the national pipeline network in a market-oriented manner, but it is not clear how to integrate. The experience of the above five provincial-level pipeline networks provides practical experience for the integration of the provincial network into the national pipeline network. Localities can adapt to local conditions to practice and explore in future reforms.

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1. Reform of the operation mechanism of the oil and gas pipeline network

In March 2019, the seventh meeting of the Central Committee for Comprehensive Deepening Reform deliberated and approved the "Implementation Opinions on the Reform of Oil and Gas Pipeline Network Operation Mechanism" (hereinafter referred to as the "Opinions"), emphasizing that "to promote the reform of the oil and gas pipeline network operation mechanism, we must continue to deepen Market-oriented reforms, expansion of high-level opening up, establishment of state-owned capital holdings, oil and gas pipeline network companies with diversified investment entities, and promotion of the formation of a multi-subject and multi-channel supply of upstream oil and gas resources, a unified pipeline network in the middle of efficient gathering and transportation, and full competition in the downstream sales market The oil and gas market system will improve the efficiency of oil and gas resource allocation and ensure the safe and stable supply of oil and gas."

The "Implementation Opinions on the Reform of Oil and Gas Pipeline Network Operation Mechanism" sounded the clarion call for the reform of the pipeline network operation mechanism. On December 9, 2019, the National Petroleum Pipeline Network Group Co., Ltd. (referred to as the National Pipeline Network Company) was formally established. The network company will build a "national one network" to realize the interconnection of oil and gas long-distance pipelines, better guarantee national energy security, and promote the high-quality development of the oil and gas industry. The establishment of a national pipeline network company is one of the most important and fundamental reform measures in the oil and gas system reform in recent years.

The "Opinions" put forward three opinions on how to integrate provincial pipeline network companies into the national pipeline network: all the equity held by large state-owned oil and gas companies in provincial pipeline network companies will be included in the national pipeline network company; local governments are encouraged to use provincial pipeline network assets to buy shares National Pipe Network Company: Following the idea of "one network across the country", after the establishment of the National Pipe Network Company, it actively guides and promotes provincial-level pipe network companies to integrate into the national pipe network company in a market-oriented manner.

Provincial pipeline networks are usually closely related to gas companies, and the integration of provincial networks into the national grid also indirectly promotes the cooperation of the national pipeline network companies with downstream industries. Through this model, the construction of a regional natural gas market will be realized and the goal of "X+1+X" oil and gas reform will be promoted. On October 1, 2020, the "three barrels of oil" pipeline network assets were officially delivered to the National Pipeline Corporation, marking the formal formation of the "X+1" model. The integration of the national pipeline network and the provincial pipeline network is an effective way to realize "1+X".

2. The way that provincial pipe network companies integrate into national pipe network companies

The "Opinions" proposed that the provincial pipeline network "integrated into the national pipeline network company in a market-oriented manner." This just puts forward a concept and principle. As for the marketization method adopted in specific practice, there is no detailed explanation. The reform idea of my country's provincial network companies is that domestic provincial-level pipe network companies will be integrated into national pipe network companies in "two types and four forms."

The first type is "full integration", that is, fully integrated into the national pipe network company. All incorporation can be divided into two ways.

One way is to follow "the equity held by large state-owned oil and gas companies in provincial pipe network companies, all of which are included in the national pipe network company." If the three major oil and gas companies of China National Petroleum Corporation, Sinopec, and CNOOC account for more than 50% of the current provincial pipeline companies, the National Pipeline Company will naturally become the largest shareholder in future reforms. These provincial-level pipe network companies have become the holding subsidiaries of the national pipe network company. The local government indirectly owns the shares of its parent company, the State Pipe Network Company, by owning the shares of the holding subsidiary of the State Pipe Network Company, so as to achieve the goal of "encouraging local governments to use provincial pipe network assets to invest in the State Pipe Network Company".

Another way is that the national pipe network company incorporates all provincial pipe network companies through asset transfer, direct acquisition, etc., and directly becomes its provincial branch company or reorganizes the provincial branch company on this basis. Local governments will not own any shares or gains in the future except for one-time cash gains during asset transfers or acquisitions.

The second type is "partial integration", that is, the provincial pipe network company is not merged into the national pipe network company and still exists separately, but it is affected and restricted by the planning, operation, and scheduling of the national pipe network company. There are also two ways of this type.

One way is that the provincial pipe network company still exists separately, and the national pipe network company participates in but does not control; the other way is that the provincial pipe network company is completely owned by the local government or other capital, and the national pipe network company does not occupy any shares. Although this kind of provincial pipe network company can exist alone in the future and has much greater operational autonomy, its business operations must undergo major changes. For example, they will spin off their natural gas sales business like the National Pipeline Company, transform into a purely transmission and distribution company, and be fair and open to third parties. Its planning and standards must be uniformly formulated and implemented in accordance with the national pipeline network company, interconnection is implemented, dispatching rights may also be handed over, the construction of the provincial pipeline network is liberalized, and diversified participation is allowed, and so on. Otherwise, these provincial-level pipe network companies may face the challenge of setting up another provincial-level branch of the national pipe network company in the local area.

According to the above classification criteria, the current 35 provincial-level pipe network companies in China will be controlled by the national pipe network company in the future based on the current shares held by the shareholders of each company, and the national pipe network company will participate in but not control, and there is no national pipe network company’s shares, independent There are three types of existence.

3. The practice of integrating provincial pipe network companies into national pipe network companies

Guangdong

On September 24, 2020, the State Pipeline Network Group and the Guangdong Provincial Government signed the "Strategic Cooperation Agreement on the Reform of the Natural Gas Pipeline Network System in Guangdong Province" in Beijing. This is the first provincial-level natural gas pipeline network integrated into the National Pipeline Network Group in a market-oriented manner, marking the establishment of the National Pipeline Network Group has entered a new stage, and the reform of the national oil and gas system and oil and gas pipeline network operation mechanism has been further implemented.

According to the agreement, the Guangdong Provincial Government and the National Pipeline Network Group will jointly promote the integration of the "provincial network" and the "State Grid", and establish the National Pipeline Network Group Guangdong Pipeline Co., Ltd. through equity integration, as the only natural gas main pipeline network in Guangdong Province Construct and operate the main body, realize the unified planning, unified construction, unified dispatch, unified operation, and unified maintenance of the province's natural gas main pipeline network; comprehensively accelerate the construction of natural gas pipelines in the province, realize the "county-county" of Guangdong natural gas main pipeline, and provide all market entities Provide fair and open services.

This cooperation has jointly created a model project for the integration of the "provincial network" into the national pipeline network, and is aimed at constructing the "X+1+X" with multi-subject and multi-channel supply of upstream resources, efficient gathering and transportation of the central unified pipeline network, and full competition in the downstream sales market. The oil and gas market system is a milestone.

Hainan

On October 1, 2020, the natural gas pipeline network of Hainan Province was officially transferred to the national pipeline network, and the Hainan Provincial Pipeline Network Company was established. As the only main body of construction and operation of the main natural gas pipeline network in Hainan, the company has realized the unified planning, construction, scheduling, operation and maintenance of the main natural gas pipeline network in the whole province, and comprehensively speeded up the construction of natural gas pipelines in the province, and realized the first gas supply in the whole province. Zhang Wang, and will inject more intensive, green, intelligent, and integrated connotations into the new round of "five networks" infrastructure construction in Hainan Province.

After the establishment of the Hainan Pipeline Network Company, the national pipeline network will accelerate the construction of natural gas infrastructure in Hainan Province, implement the "Gasification Hainan" action plan, and build a service platform that provides fair, open and fair competition for various resource entities and downstream market users.

At the same time, the company will build a “one network” of natural gas trunk pipelines covering the whole province, sharing resources, and fair and open, which will help eliminate resource transmission bottlenecks, ensure the safe and stable supply of natural gas, reduce intermediate gas supply links, and reduce end-user consumption. The cost of gas will promote the economic and social development of Hainan, benefit the people of the whole province, and help the construction of Hainan’s free trade port.

During the "14th Five-Year Plan" period, the national pipeline network will continue to implement the construction of the main natural gas network and supporting projects around the island, and establish a main network covering major coastal cities and important industrial and economic development zones in Hainan Province.

Hubei

After the Guangdong Provincial Network and the Hainan Provincial Network were successfully put into the embrace of the national pipeline network, the third one finally came. This third one is Hubei Provincial Net.

According to the announcement of Hubei Energy Group Co., Ltd. (hereinafter referred to as Hubei Energy), a listed company of Hubei Net Holdings’ parent company, Hubei Energy held the fourth meeting of the Ninth Board of Directors on October 28, 2020, and reviewed and approved the "Regarding Hubei Province Natural Gas Proposal for the Division and Reorganization of Development Co., Ltd.". With 7 votes in favor, 0 votes against, and 0 abstentions, the company’s board of directors agreed to the company’s holding subsidiary Hubei Natural Gas Development Co., Ltd. (hereinafter referred to as the Provincial Natural Gas Company) division and reorganization plan, and authorized the company’s management management to sign the agreement for the division and reorganization. Matters such as the establishment, asset audit and evaluation, industrial and commercial registration or change.

The specific method of separation and reorganization is: Hubei Provincial Network will first separate management and sales, separate and reorganize into a pipe network company and a sales company. The pipe network company will then be integrated into the national pipe network, and the sales company will continue to retain Sinopec’s shares. Among them, many operational details of the integration of the provincial network into the national pipeline network are worth savoring.

However, since the Hubei Provincial Network used to be Hubei Energy Holdings (51% shareholding) and Sinopec’s equity participation (49% shareholding), Hubei Energy Holdings will be maintained in the future. After the state takes over, how to operate and manage I am afraid there is still some way to go for unification.

Hunan

According to the news from the National Pipeline Network on January 22, 2021, the National Pipeline Network Group and the Hunan Provincial Government recently signed the "Agreement on Strategic Cooperation on Natural Gas Pipeline Networks." This is another provincial-level natural gas pipeline network integrated into the National Pipeline Network Group in a market-oriented manner, and new results have been achieved in the integration of the "provincial network".

According to the agreement, the two parties will complete the integration of the provincial natural gas pipeline network platform in Hunan Province as soon as possible, and establish the National Pipe Network Group Hunan Natural Gas Pipe Network Co., Ltd. as the sole construction and operation entity of the provincial natural gas pipeline network in Hunan Province, realizing natural gas pipeline network throughout the province. “One investment subject, one network, one price”; in accordance with the principles of unified planning, unified construction, unified dispatch, unified operation, and unified price, continue to promote the implementation of the “Gasification Hunan Project” and realize the “county-county connection” of natural gas pipelines. , Full coverage" and provide fair and open services to all market entities.

It is reported that the total mileage of the provincial-level natural gas pipeline network in Hunan Province exceeds 2,000 kilometers, the prefecture-level coverage rate is 86%, and the county-level coverage rate is 60%. This cooperation will create a “one network” of provincial-level natural gas trunk pipelines covering the whole province, resource sharing, and fair and open, eliminate resource transmission bottlenecks, reduce intermediate gas supply links, and ensure the safe and stable supply of natural gas. This will help promote Hunan’s economic and social development. It is of great significance to further implement the new energy security strategy of "Four Revolutions, One Cooperation" by General Secretary Jinping and the national decision and deployment on the reform of the oil and gas pipeline network operation mechanism, and to build an "X+1+X" oil and gas market system.

Fujian

On April 25, 2021, the State Pipeline Network Group and the Fujian Provincial Government signed the "Cooperation Agreement on Deepening the Development and Reform of Natural Gas Pipeline Networks" in Fuzhou. This is an important measure for the two parties to jointly implement the new energy security strategy of General Secretary Jin Ping’s "Four Revolutions, One Cooperation" and the Party Central Committee and the State Council’s decision and deployment on the reform of the oil and gas pipeline network operation mechanism. new progress.

According to the agreement, the two parties agreed to establish the National Pipe Network Group Fujian Pipe Network Co., Ltd., as the sole construction and operation entity of Fujian’s natural gas pipeline network "one network in the whole province", in accordance with the "unified planning, unified construction, unified scheduling, and unified operation" , Construction and operation of provincial-level pipeline network based on the principle of unified maintenance and unified price. The State Pipeline Network Group will accelerate the construction of natural gas infrastructure in Fujian Province, support the cultivation of the gas market, promote the development of Fujian Province's natural gas infrastructure, and make contributions to the comprehensive promotion of high-quality development in Fujian Province.

Up to now, the total mileage of natural gas pipelines in Fujian Province has been 1,566 kilometers, including national trunk oil and gas pipelines such as the Fujian section of the Third West-East Gas Pipeline, and Fujian's internal pipeline network such as the West-East Gas Pipeline. Through this cooperation, the creation of a new provincial-level natural gas pipeline network platform and the construction of the "X+1+X" oil and gas market system are of great significance for Fujian Province to accelerate green and low-carbon development and take the lead in achieving the strategic goals of carbon peak and carbon neutrality. .

Four, summary

The Fujian Provincial Network is the fifth provincial natural gas pipeline network to be included in the national pipeline network after Guangdong, Hainan, Hubei, and Hunan. The reform of these five provincial-level pipeline networks provides a template for the integration of other provincial-level pipeline networks into the national pipeline network, and also echoes the "Implementation Opinions on the Reform of Oil and Gas Pipeline Network Operation Mechanism." Except for the Hubei provincial network adopting the "partial integration" approach, other provincial-level pipe network companies all adopt the "full integration" approach. The provincial pipeline network can directly assign assets to the national pipeline network like PetroChina and Sinopec, or it can form a joint venture with the national pipeline network. Analyzing from the current experience, the latter may become the first choice.

The oil and natural gas industry is an important pillar industry for national energy security. In the future, it is necessary to strengthen exploration and practice to promote the coordinated and healthy development of provincial pipeline networks and national pipeline networks, and finally form a "national network". Editor/Sang Xiaomei