Draft rules for China's domestic oil trade are prompting concern about whether the country will make good on a commitment to open the sector to foreign companies this year, The Wall Street Journal reported, citing executives at French energy company Total SA.
China committed to letting foreigners into its oil market as part of its accession to the World Trade Organization in 2001.
However, a new draft of distribution regulations is vague on major points about the requirements for licenses and exactly what they will allow.
"Until the rules are clarified and precise, we won't know if there is a genuine willingness to open this sector or [if] it is just a way to continue the duopoly of Sinopec and PetroChina in the sector," quoted Jacques de Boisseson, general representative of Total in China, as saying.
Jeff Attwood, president of Total (China) Investments Co., said the uncertainty might cause Total to delay its planned investment in the distribution business and could undermine an existing joint-venture agreement to build a network of 500 filling stations.
Several foreign oil giants have already signed joint ventures with Chinese partners to build filling stations across China. BP PLC is working with both Sinopec and PetroChina to build as many as 1,000 stations in eastern and southern China, while Royal Dutch Shell PLC has teamed up with Sinopec to build as many as 500 stations in eastern China, said the paper.