China has announced that it intends to set up giant USD 2.9 billion oil and gas pipeline across Myanmar.

According the sources, the work on the new pipeline connecting Myanmar with its Yunnan province would commence early next fiscal.

This project (joint venture between China and Myanmar) was being undertaken to trim down Beijing`s over-dependence on energy transportation from the Gulf through the straits of Malacca.

The sources further disclosed that the project entails building of two separate pipelines one worth US$ 1.5 billion oil pipeline and the other US$ 1.4 billion gas pipeline, with the country`s major China Natural Petroleum Corporation holding a 50.9 percent stake in the project. The remaining stake would be owned by Myanmar Oil and Gas Enterprises.

Once the pipeline gets finalized, it will offer an alternative route for China`s crude import from West Asia and Africa through the straits of Malacca.

China proposes to extend its oil and gas pipelines by 60% by fiscal 2010.