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“This accident is likely to build in much higher safety costs into these systems going forward,” HSBC said in a report.
“Because oil and gas are volatile and combustible products, great care must be exercised at all times in producing, transporting, storing and processing these commodities,” said HSBC.
Chinese authorities have urged the country’s energy industry to improve work safety standards.
“A comprehensive safety inspection is being planned,” said Wu Xinxiong, Head of the National Energy Administration on Monday.
The deadly blast took place in Qingdao city on Friday morning after crude oil leaked from an underground pipeline operated by Sinopec, the country’s largest oil refiner.
The accident claimed 55 lives with nine people still missing, and wounding 145 others.
Chinese oil companies, including Sinopec and China’s largest oil producer, PetroChina, operate extensive amounts of infrastructure, according to HSBC.
The report said China had a total of 90,123 km of oil and gas pipelines by the end of last year with Sinopec and PetroChina holding a majority of these pipeline assets.
PetroChina operates 16,344 km of crude oil pipes, 9,437 km of oil product pipes, 35.6 million cubic metres of crude storage and 40,995 km of natural gas pipeline systems.
Sinopec owns 7,100 km of crude oil and 9,614 km of oil product pipelines, 35.6 million cubic metres of crude storage and 6,856 km of natural gas pipeline systems.
Following Friday’s fatal explosions, Chinese President Xi Jinping has ordered a large-scale production safety check and warned Chinese industries to “learn the lessons”.
“This accident once again sounded an alarm for us that production safety must be ensured without loosening hold. Otherwise, it will bring irredeemable loss for the country and the people,” President Xi said on Sunday.