China plans to build the world's longest underwater tunnel, an expert involved in the project told AFP Friday, a $36 billion shortcut between two northern port cities in an earthquake-prone region.

The scheme will see cars loaded onto railway carriages before travelling at 220 kilometres per hour (136 miles per hour) along the 123-kilometre tunnel connecting Dalian in Liaoning province and Yantai in Shandong province.

"The underwater tunnel is expected to be completed within the period of the 13th five-year plan (2016 to 2020)," said Wang Mengshu, a tunnel and railway expert at the Chinese Academy of Engineering.

"The cost will be around 220 billion yuan and it will be the world's longest underwater tunnel," added Wang, who has worked on the plan since 2012.

A blueprint for the mammoth project is expected to be submitted to the all-powerful State Council in April, a report in the China Daily said Friday.

Wang told the newspaper that journey time would be cut to 40 minutes after completion of the tunnel, which follows the coastline to the west of Yantai, before veering north across the Bohai Sea.

The tunnel would surpass the combined length of the world's two longest tunnels, Japan's Seikan Tunnel linking Honshu and Hokkaido and the Channel Tunnel between Britain and France.

It would drastically cut the current travel time between the two cities, which are currently separated by a 1,400-km drive or about eight hours by ferry.

Three tunnels in total will be built at least 30 metres below the sea bed, two about 10 metres in diameter, and a third between them for maintenance and emergency vehicles, the China Daily added.

Officials involved with the project have identified safety as a "top concern", the newspaper said.

The tunnel runs across two earthquake fault lines, and in 1976 the industrial city of Tangshan in Hebei province -- between Shandong and Liaoning -- was levelled by an earthquake with a magnitude of at least 7.5, although figures vary.

Beijing puts the official death toll at 242,000, while some outside estimates are as high as 655,000, the US Geological Survey says on its website.

China's transport infrastructure has developed rapidly in recent years, particularly its high-speed rail network, which was only established in 2007 but has fast become the world's largest.

But while it is a symbol of China's emergence as the world's second largest economy, it has also been plagued by graft and safety scandals, such as a collision in July 2011 in the eastern province of Zhejiang that killed 40 people.

The accident caused a torrent of public criticism of the government amid accusations that authorities compromised safety in their rush to expand the network.