China has denied claims that its backing for the Sri Lankan Hambantota port and bunker terminal project is part of a strategic plan to project its power in the Indian Ocean region.

"It's true that China is conducting cooperation with some Asian countries in various fields including port development, but it's justifiable business for China and the joint ventures are for commercial purposes only," said a spokesman for the Chinese embassy in the United States.

He was responding to a US military study that said the Hambantota port development project was part of a plan to gain influence in the region.

“China's activities are for mutual benefit and peaceful purposes, constituting no threat to anyone else,” said the spokesman.

Hambantota is being developed as a major port and regional bunker hub.

Plans call for a bunker terminal with an initial capacity of 500,000 metric tonnes (mt). The terminal is expected to be operational in mid-2010. 

Work on the Hambantota project, which is being carried out by contractors from China, has been proceeding ahead of schedule.

China is expected to contribute more than 85% of the total cost of the project, which will take 15 years to complete.