The State Council issued a circular on March 31, approving measures to open up the entire industrial chain of oil and gas in the China (Zhejiang) pilot free trade zone (FTZ).

An open oil and gas sector should pave the way for greater reform, development and innovation to transform the Zhejiang pilot FTZ into a new hub for reform and opening-up in the new era, the circular said.

The provincial people’s government should take the main responsibilities with detailed policies to support implementation of those measures and supervise market entities trading oil products and overall market operation to avert and control risks, the circular said.

The Ministry of Commerce and related departments should be assigned specific responsibilities and strengthen guidance and services to help solve difficulties and problems facing the FTZ, it added.

The opening-up move involves introducing global strategic investors engaged in oil product trading, upgrading and transforming the oil refining industry, and building the liquefied natural gas (LNG) receiving terminal in pursuit of a complete oil and gas industry chain.

To bolster the local oil market, the FTZ will gain support in the export as well as domestic sales and distribution of refined oil products, and production of low sulfur marine fuel oil.

Other driving forces include innovative oil shipping models such as customs clearance reform, aligned commodity futures and spot markets, and greater information interconnectivity.

Better financial services and regulation in terms of cross-border commodity trading will be encouraged within the FTZ, and fiscal and tax policies will be in place to drive the entire industrial chain of oil and gas.

Meanwhile, marine ecosystem protection will accompany oil and gas exploration in the FTZ.