China's biggest oil refiner Sinopec aims to secure up to three medium- or large-sized natural gas finds with reserves of 60 billion cubic meters (bcm) in Northeast China by 2008.

 

The new gas finds will be located south of China's biggest oilfield Daqing in the Songliao Basin, a Sinopec official, who refused to be identified, told China Daily yesterday.

 

Analysts said the new discoveries, if successful, would significantly increase Sinopec's gas reserves and help the country ease its heavy reliance on imports for the cleaner fuel.

 

By the end of last year Sinopec had proven natural gas reserves of 83.6 bcm.

 

"We expect to find two or three fields in the southern part of Songliao Basin, which will be strategically important for Sinopec to sustain its resources," the official said.

 

The company found a natural gas well in the region last month, which could produce 205,000 cubic meters of natural gas per day.

 

Zhang Kang, a senior geologist with the Beijing-based oil firm, said the well discovery raised the potential of there being more gas reserves located in the deep seams around the basin.

 

"We have been working on exploration of oil and gas in the region for quite a long time and the new discovery is a very positive sign," Zhang said.

 

The new find followed announcements from both Sinopec and PetroChina on major gas discoveries in Northeast and Southwest China.

 

Hong Kong and New York-listed Sinopec in April said it had found the Puguang Gasfield with proven recoverable reserves of as much as 251 bcm in southwestern Sichuan Province.

 

When commercial operation begins, annual production of the Puguang field is expected to reach 4 bcm and 8 bcm by 2008 and 2010 respectively, Sinopec said in a statement.

 

In another significant move, the nation's biggest oil producer PetroChina at the end of last year announced the discovery of another 100-bcm gas field under the Daqing Oilfield in Northeast China's Heilongjiang Province.

 

Beijing-based Sinopec has budgeted 29.8 billion yuan (US$3.7 billion) on oil and gas exploration this year, an increase of 29.6 percent from last year.

 

"We should step up exploration efforts to ensure a sustainable balance between production and reserves," Sinopec said in its annual report.

 

The State-owned oil refiner, Asia's largest, produced 6.28 bcm of natural gas last year, and its newly added recoverable gas reserves amounted to 3.98 bcm for the same period.

 

Rising global gas prices have dampened the country's ambitious target of importing the cleaner fuel in meeting energy demands and cutting reliance on oil and coal, and analysts said strengthening domestic exploration would help alleviate the shortage.

 

Xu Dingming, vice-chairman of the government's leading energy group, last week said the country would not import large volumes of natural gas if prices remain high.

 

China will be able to produce up to 150 bcm of natural gas by 2020, and imports could reach about 90 bcm by then to meet surging demand, Zhai Guangming, a senior expert with PetroChina, said in May.

 

(China Daily July 6, 2006)