Exploration and development are picking up in China's huge, remote northwestern basins.
Beijing's China Daily reported the government has earmarked 1.5 billion yuan ($319 million) for exploration and development in the massive Tarim basin of Northwest China the next 2 years. In addition, plans call for accelerated production of Chinese drilling equipment designed for work in the region, the newspaper reported.
China Daily also reported the first commercial oil field in the Tarim Northwest China will start production by yearend.
Meantime, China Features, also of Beijing, reported another significant oil discovery in the Tarim basin and a world class gas discovery in Northwest China's Qaidam basin.
In addition, China is pressing industrial development in the region, including expansion of its downstream petroleum infrastructure, the official Xinhua News Agency reported.
NORTHWEST PUSH
China's recent heightened emphasis on its northwestern basins represents a shift in oil policy for the country's eighth 5 year plan (1991-95), Ren Kan wrote in China Daily.
Chinese geologists estimate the potential oil resource in the Tarim basin, contained within the Xinjiang Uygur autonomous region, at 74-219 billion bbl. Official estimate of the basin's natural gas potential resource is 29.3 tcf.
The government has assigned 20,000 persons to Tarim basin exploration since China Oil & Natural Gas Exploration & Development Corp. (Congedc) set up headquarters in the region last April, China Daily reported.
To date, 15 of the 17 rigs suited for Tarim desert work have been imported, Ren wrote.
The new rigs planned for work in the 126,423 sq mile Taklimakan Desert that covers much of the 214,536 sq mile Tarim basin will be domestically produced but based on foreign technology.
Ren reported China's Ministry of Machinery and Electronics Industry will focus on producing drilling rigs rated to about 20,000 ft, workover rigs, blowout preventers, Christmas trees, manifolds, and hydraulic fracturing equipment ideal for the sandstone reservoirs that dominate the Tarim basin.
TARIM FIRST
China Daily, quoted by Xinhua, reported first commercial production will begin at a Tarim basin oil field early next year.
Xinhua did not identify the field, but it likely is Tazhong, where a 1989 discovery well tapped China's largest known subsurface structure (OGJ, Jan. 22, p. 23). Most Tarim drilling has been on the 2,567 sq mile structure.
What China Daily reported as Tarim's "first pilot oil field" is about 40 km south of Luntai County in Xinjiang Uygur.
It quoted a Congedc official as saying 16 wells in the area have yielded commercial volumes of oil and another 11 are still to be tested.
Test production is expected to total 1.095 million bbl of crude by yearend, China Daily reported.
The "pilot" is expected to produce about 20,000 b/d in 1991, the newspaper said.
Plans call for pipelines to be laid to Luntai to transport Tarim oil, which then will move via rail to Urumqi, the region's capital. There, the oil will be used as feedstock at the $600 million Xinjiang petrochemical complex, under construction, that includes a 140,000 ton/year ethylene unit.
China used $5.87 million that was provided by the United Nations Development Program to procure "advanced well drilling expertise" to help solve technical problems in the geologically complex basin, Xinhua reported.
MORE NORTHWESTERN STRIKES
Recent discoveries have boosted oil and gas prospects for the northwestern basins of China, reported China Features correspondent Xu Yihe
The 1 Donghe discovery well flowed 1,223 bbl of light oil and 24.7 Mcf of gas through an 11 mm choke during a 12 hr test last summer. That works out to 2,446 b/d and 49 Mcfd.
A 50.95 ft oil saturated core was later recovered from the well. At last report, 1 Donghe was drilling ahead en route to a projected 20,669 ft.
The discovery is on the "bulge" portion of the northern Tarim basin between two other oil bearing structures, Lunnan and Yingmai.
"Existence of oil in the well has further proved that the entire bulge area is rich in oil and that oil and gas fields in the area may be linked with one another," Xu wrote.
In all, 20 wildcats have been drilled in the northeastern and north central portions of the basin, with 14 yielding commercial hydrocarbon volumes. The biggest was 18 Sha on the Akekula structure in 1989, which flowed 147 MMcfd of gas and 8,805 b/d of condensate from pay at 16,919 ft, Xu wrote.
Meantime, Chinese explorationists found a field that more than doubles gas reserves in the eastern Qaidam basin, located in western Qinghai Province, Xu reported.
The discovery, Tainan field, is estimated to hold reserves of 702 bcf, boosting total eastern Qaidam reserves to 1.017 tcf.
Tests of five wells in the field prove a productive capacity of about 35 MMcfd, Xu wrote, adding the reservoir is shallow and features soft formations.
DOWNSTREAM PUSH
China envisions Xinjiang Uygur becoming one of the country's main chemical production bases under the eighth 5 year plan, Xinhua reported. Xinhua said the Ministry of Chemical Industry is drawing up a development plan for the 1990s for the remote northwestern region to take advantage of growing oil and gas production.
Plans include new facilities and revamps at old plants producing oil and gas based petrochemicals and inorganic salts. In western Xinjiang Uygur, plans call for a petrochemical complex adjoining the refinery at Dushanzi.
Efforts to intensify exploration for other mineral resources are also planned in Xinjiang Uygur to boost the local mining industry, Xinhua said.
Copyright 1990 Oil & Gas Journal. All Rights Reserved.