PetroChina and SinoPec, two leading Chinese oil companies, have signed a framework agreement with the China Aviation Oil Holding Company (CAOHC) establishing a giant joint venture aviation oil company.

According to the agreement signed here Monday, the two oil companies will hold minority shares in the main subsidiary of CAOHC, which operates an aviation oil sales network in nearly 100 Chinese airports, serving 108 Chinese and foreign airlines.

Pu Guangji, a CAOHC official, said the alliance will sharpen the competitive edge of Chinese aviation oil supply companies prior to the opening of this market.

China will open up the retail market of finished oil by the end of this year and the wholesale market of finished oil by the end of 2006 to fulfill its commitments to the WTO.

PetroChina is the largest crude oil and natural gas producer in China. SinoPec is one of the largest oil and chemical product producers in China, operating nearly 30,000 gas stations across the country.

Source: Xinhua