PETROCHINA Co won state approval for its plan to double ethylene capacity at its Daqing petrochemical plant in northeastern China, the nation's top economic planner said.

PetroChina, the nation's biggest oil company, ill increase the unit's ethylene capacity to 1.2 million metric tons a year, the National Development and Reform Commission said in a statement on its Web site, without giving an investment figure for the project.

China's petrochemicals makers are raising capacity and output as a faster pace of economic expansion stokes demand for chemicals used to make yarn and plastics. China, whose economy grew 11.1 percent in the first quarter, imports half its ethylene needs.

PetroChina will increase its ethylene capacity to 7 million tons a year by 2010 from 2.63 million tons last year, Liu Jie, deputy chief economic adviser at PetroChina's chemicals and market unit, said May 24. It will build six ethylene projects in Daqing, Jilin, Fushun in the northeast, Lanzhou, Dushanzi in the northwest and Sichuan in the southwest, by 2010, Liu said.

China, the world's second-biggest energy consumer, may need up to 10 percent more ethylene this year to feed the nation's rising plastics production, Gu Zongqin, president of the government-backed China Petroleum and Chemical Industry Planning Institute, said May 26. Demand for ethylene, a key ingredient in plastic water bottles and synthetic fibers, will increase from 17 million tons last year, Gu said.

China produced 9.41 million tons of ethylene last year, and is adding 7.2 million tons of capacity, the commission said on Jan. 31. The nation's ethylene supply gap may widen to 16 million tons by 2020, from 9 million tons in 2010, PetroChina's Liu said last month.

The Daqing oilfield, the nation's oldest, may cut its output more than 50 percent in five decades as reserves decline, China National Petroleum Corp., the parent of PetroChina, said
February 26.