CHINA TO HIKE OIL FLOW VIA TECHNOLOGY IMPORTS

China plans to spend $500 million to import petroleum technology and equipment during the next 5 years. It's part of a drive to boost oil production to 2.9 million b/d by 1995 from 2.76 million b/d in 1990, says China National Petroleum Corp. (CNPC) Pres. Wang Tao. Oil flow during the first 2 months of 1991 averaged 2.79 million b/d. During a speech to a national oil conference in Beijing, Wang disclosed a three prong strategy to improve the nation's oil industry, China Daily

April 1, 1991

3 min read

China plans to spend $500 million to import petroleum technology and equipment during the next 5 years.

It's part of a drive to boost oil production to 2.9 million b/d by 1995 from 2.76 million b/d in 1990, says China National Petroleum Corp. (CNPC) Pres. Wang Tao. Oil flow during the first 2 months of 1991 averaged 2.79 million b/d.

During a speech to a national oil conference in Beijing, Wang disclosed a three prong strategy to improve the nation's oil industry, China Daily reported. The program has a production target of 3.4 million b/d by 2000 (OGJ, Mar. 4, Newsletter).

China Daily also said China National Offshore Oil Corp. (Cnooc) plans to increase its oil production capacity to 160,000 b/d in 1995.

CNPC will emphasize oil exploration and improvements in oil production methods to maintain a steady increase in China's oil flow this decade. At the same time, Wang said, China will cooperate with non-Chinese firms to search for oil in other countries and regions.

CNPC STRATEGY

The first phase of Wang's three prong plan calls for CNPC to step up the pace of exploration in the Northwest China frontier while maintaining production from older oil fields in eastern China.

The country's oil industry also plans to focus on processing oil and gas under state planning to improve its "ability to self-develop," Wang said.

China will, as the third part of its strategy, expand economic and technological exchanges with the outside world and become more involved with the international oil market.

About 90% of China's present oil production comes from aging fields in the eastern part of the country, where 80% of proved reserves lie.

All of those fields, such as Daqing, Shengli, and Liaohe, are more than 30 years old. Their production is failing at a rate of 10%/year. Wang expects the older fields to continue accounting for more than 80% of the country's production through 2000.

Industry officials hope large reserves discovered in the Northwest, mainly in the Tarim and Turpan-Hami basins in Xinjiang Uygur autonomous region, will offset declining production from eastern China fields.

China's crude demand has been increasing at the rate of 120,000 b/d/year, says Beijing's Xinhua News Agency. China began importing oil in 1986, and the volume of imports has steadily risen since then.

In addition to exploration technology, Wang said, CNPC hopes to benefit from foreign expertise in production, well stimulation, directional drilling, and heavy oil recovery.

CNOOC GOALS

A Cnooc official told China Daily 11 offshore fields will go into various stages of development in the next 5 years. In addition to the oil production target, Cnooc hopes to increase offshore gas productive capacity to 3.75 billion cu m/year by 1995.

In recent action, Huizhou 26-1 and Weizhou 10-3N oil fields in the South China Sea are to be on stream by yearend.

Cnooc and Amoco Orient Petroleum Co. are studying joint development of Liuhua 11-1, said by Cnooc to be China's largest offshore oil field (OGJ, Feb. 4, p. 20).

Plans for development of four other offshore fields will be submitted to Cnooc for approval by yearend, the official said.

Xinjua said units of Cnooc have cooperated with overseas partners in 60 petroleum exploration, development, and production projects with a total investment of $40.3 billion.