Shell, PetroChina to drill gas wells

PetroChina Co.�s subsidiary Changqing Petroleum Exploration Bureau has reached an agreement with Shell Exploration (China) Ltd. under which Shell will drill and test two gas wells on Changbei block in the Ordos basin. Drilling will start in July.


BEIJING� PetroChina Co.�s subsidiary Changqing Petroleum Exploration Bureau has reached an agreement with Shell Exploration (China) Ltd. under which Shell will drill and test two gas wells on Changbei block in the Ordos basin. Drilling will start in July.

Changqing, which operates in northwestern China, plans vertical and horizontal sections in both wells to help evaluate the commerciality of a field.

The $4 million project is part of Shell and PetroChina�s larger program involving production of gas on Changbei block, construction of a pipeline, and development of gas markets in northern and eastern China. The entire project will cost $3 billion.

China National Petroleum Corp., the parent company of PetroChina, and Shell signed a contract last September to develop the integrated Changbei project. PetroChina sees this project as an integrated part of China's ambitious plan to increase gas utilization this decade.

Shell is targeting 2004 for the project startup.

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