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Oil Theft Rings Ensnare Local Government
Summary:Police from the Daqing oil field in Heilongjiang have been grappling with oil thieves for years. Their fight led them to refineries in surrounding cities, but local governments were in no rush to see a huge source of tax revenue eliminated.

By Liu Jinsong (
刘金松) Chen Zhe(陈哲) Qiao Yafei (乔亚飞)
Issue 629, July 22, 2013
Society, Page 13
Translated by Siutan Wong
Original article:

Oil fields across China are frequently victims of oil theft, but for police in Daqing (大庆), Heilongjiang Province, fighting these thieves has become a protracted war with many hidden enemies.

According to Sun Huacheng (孙化呈), director of the Public Security Bureau of Daqing Oil Field, there are over 90,000 wells and thousands of kilometers of pipelines spread over the 5,000-square kilometer Daqing Field. Protecting this field is a gargantuan task for local police.

In 2005, they began a strategy called “Punish the major thieves and educate the small ones.” Two years later, they’d cleared many gangs out of the city, but the problem was far from solved.

According to Sun, after 2007, gangs and illegal oil refining factories moved to cities around Daqing, like Zhaodong (肇东), Qiqihar (齐齐哈尔) and Harbin (哈尔滨). Sun said the gangs would still siphon oil from Daqing but refine it in other cities.

Realizing Daqing’s problem couldn’t be solved within its own borders, police tracked down thieves in the surrounding cities they were operating in. But it soon became apparent that there were bigger fish to contend with than just small-time oil runners. “The oil theft businesses wouldn’t be so large without protection from local governments,” Sun said.

In 2009, Daqing police discovered four illegal refining fields in Harbin. One of the cases involved 8,000 tons of stolen oil and more than 100 people, including several officials in the local Public Security system.

Then at the end of 2012, Daqing Police found another gang that had been stealing oil from Daqing Field, refining it in Liaoning Province and selling it in Hebei Province.

During the investigation, police found that it was very easy to pass checkpoints on the highway between Liaoning and Hebei. The only things that were inspected were the weight, height and speed of a vehicle. Nobody ever checked the goods inside.

In April 2013, Daqing police caught another 63 suspects in four different provinces. In the aftermath, there were disputes with other local police departments as to what should be done with the stolen oil. Daqing police wanted it back, but authorities in Cangzhou (沧州) refused. Local oil companies said that there was no evidence showing that their refined goods had been made from stolen Daqing oil. And even if they had been, the distribution should be done according to the local court’s ruling.

Both refineries involved in the case were located in Nandagang Industrial Park (南大港产业园), a major chemical engineering site in Cangzhou. According to one local official, the original tax collection target for the industrial park in 2013 was 600 million yuan, but because many companies have shut down since the lid was blown off the theft case, that target will be difficult to achieve.

According to public records, the population of Nandagang is about 40,000 - similar to the size of a rural town. But the total tax income from the site was 540 million yuan last year – similar to that of several large counties.

A local source told China News Week (中国新闻周刊)that oil companies must pay a hundreds of thousands of yuan to the local government in addition to their normal taxes. “These companies have been in Cangzhou for decades,” the source said. “They all had a close relationship with local officials.”

Over the past two months, Daqing police have received tips from locals in Cangzhou reporting illegal actions among local officials. One recently retired official from the Cangzhou government told China News Week that since all the large oil fields are owned by the state, some local officials thought that the security of oil channels was none of their concern, and that taking advantage of oil theft was even fair game.

“Destroying illegal refineries is key in the fight against oil thieves,” the official said. “However, since those refineries played an important role in the government's tax income, sometimes authorities did nothing to stop the crimes.”

Links & Sources
China News Week: 沧州盗油案背后:当地警方“不配合”阻止回收赃物


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