Experts suggested China set up a state energy base in Inner Mongolia Autonomous Region to ease its energy thirst, according to a survey report released on Tuesday.

The survey was co-conducted by senior researchers from the National Development and Reform Commission, Development Research Center of the State Council, Chinese Academy of Sciences and the Ministry of Finance.

"To plan and establish strategic energy bases at state level in the spirit of 'giving priority to energy saving and diversifying energy consumption with the utility of coal at the core' is the fundamental solution to meet the country's huge energy demand," said Duan Lianao, initiator and writer of the report.

Inner Mongolia has made itself outstanding by its geographic significance and rich energy resources.

Spanning northeast and northwest China, Inner Mongolia is close to several manufacturing bases and large markets of the country, such as Hebei, Liaoning, Jilin and Heilongjiang provinces.

Statistics show Inner Mongolia is home to an abundance of resources, including coal, oil, natural gas and wind.

The region has proven coal reserve of 676.34 billion tons, ranking first among all the provincial regions throughout the country. It also has proven oil reserve of 700 million tons and the proven natural gas reserve of the Ordos Basin in Inner Mongolia accounts for 40 percent of the nation's total reserve.

In recent years, more and more electricity has been delivered from Inner Mongolia to the eastern cities like Beijing and Shanghai, where the economy is more developed. According to the country's development plan, Inner Monglia will be built into China's largest power base by 2010.

"With the soaring international oil prices, building strategic energy bases is our inevitable choice. Moreover, Inner Mongolia itself will benefit from the process of construction," said Jiang Yuezhong, expert with Chinese Academy of Social Sciences.

Foreign analysts predicted China's oil consumption would climb at an annual pace of 3 percent in the coming years. The dependence on imports would reach 50 percent by 2020.

China had set up its first national oil reserve base in December 18, 2007, a move to offset oil supply risks and reduce the impact of fluctuating energy prices worldwide on China's domestic market for refined oil.

(Xinhua News Agency January 2, 2008)