BP drops bid for China's West-East oil pipeline. (Environmental Intelligence).

In September 2001, British Petroleum (BP) dropped its bid for China's massive West-East pipeline project, which will run 4,200 kilometers from the oil-rich Tarim Basin north of Tibet in the Xinjiang Region. As planned, the $18 billion pipeline will cross through nine provinces and span 40 rivers before it reaches its final destination in Shanghai.

China relies mainly on coal for its energy, and the resulting pollution has caused enormous health and environmental costs. (Some Chinese cities suffer from some of the worst air quality in the world.) In response, the government is attempting to shift to the somewhat cleaner fuels, natural gas and oil, and has begun opening the country's energy market to foreign corporations to bring in their expertise. Two years ago, BP played a major role in bailing out the initial public offering of stocks in state-owned PetroChina. The offering had met with considerable opposition in the United States because the Chinese company owns a 40 percent stake in Sudan's Greater Nile Petroleum Operating Company, which has been cited for human rights violations and links to international terrorism.

The pipeline is part of the Chinese government's "develop the West" strategy, which aims to boost economic prospects in the less-developed outer provinces. Environmental and human rights advocates have questioned whether this strategy will benefit the rural outer provinces, or simply allow the central government to exert greater control over the resources and people of these diverse and sometimes rebellious regions.

While activist groups had been pressuring the oil giant to drop the project for human rights concerns, a BP spokesman said the company had pulled out because it didn't think it could make a "unique contribution" to the endeavor. The Free Tibet Campaign and other groups are now pressuring ExxonMobil and Royal Dutch/Shell, the other main bidders, to follow suit.