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Ohio Utica Shale

China company reports shale success in Sichuan province

By Bob Downing Published: January 29, 2014

From Bloomberg News last week:

By Aibing Guo

Jan. 23 (Bloomberg) -- China Petrochemical Corp., Asia’s biggest refiner, made a "strategic breakthrough" in shale gas exploration in southwest China’s Sichuan province.

The company also had a significant advance in shale gas exploration technologies, Chairman Fu Chengyu said in a statement on the company’s official microblog at Sina.com amid its annual work conference in Beijing from Jan. 20 to 22. The new technologies have been applied in the Sichuan project, Fu said, without elaborating.

China Petrochemical may produce as much as 550,000 cubic meters of shale gas a day from its fields in Sichuan’s Fuling, according to a Jan. 15 report from the research arm of China National Petroleum Corp., the country’s biggest oil and gas explorer.

Southwest China, which includes Sichuan, and the Upper Yangtze River area account for 40 percent of the country’s estimated 25.08 trillion cubic meters of shale gas reserves, the world’s largest, according to the Ministry of Land and Resources. China aims to produce 6.5 billion cubic meters of shale gas by 2015 and as much as 100 billion cubic meters by 2020, from almost zero commercial output in 2013.

China Petrochemical will scale back investment in 2014 and focus on improving returns and efficiency of current projects, Fu said. The company will "deepen all-around reforms internally" and work to streamline management mechanisms at its domestic and overseas units, he said, without elaborating.

Crude Output

Crude oil production rose 1.4 percent and natural gas output increased 10 percent in 2013, China Petrochemical said on its microblog, without providing comparable or absolute numbers for oil and gas production. Oil processing increased 4.8 percent from a year earlier.

Overseas oil and gas production in 2013 increased 33 percent from the year before and the refining business returned to profit, General Manager Wang Tianpu said in the post, published on Jan. 21 and confirmed by a spokeswoman today.

The company, the parent of Shanghai- and Hong Kong-listed China Petroleum and Chemical Corp., known as Sinopec, said in January last year that crude oil output increased 455,000 tons and natural gas output added 2.3 billion cubic meters in 2012.

Sinopec is expected to release annual production numbers in March. It produced 428 million barrels of oil equivalent, or 60.2 million tons, in 2012.

Fu and Wang were disciplined earlier this month for a Nov. 22 crude pipeline explosion in the eastern Chinese city of Qingdao that killed 62 people. China Petrochemical will strengthen work safety measures to prevent similar accidents, Fu was quoted saying.

China National Petroleum, the parent of listed unit PetroChina Co., produced more than 300 million metric tons of oil and gas in 2013, the Beijing-based company said on Jan. 17.

Cnooc Ltd., China’s biggest offshore oil and gas producer, plans to produce 422 million to 435 million barrels of oil equivalent, a 5.6 percent increase from a year earlier, in 2014, it said on Jan. 20. The company produced 412 million barrels of oil equivalent last year, including 61 million barrels from unit Nexen Inc. in Canada.

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Marcellus and Utica Shale Resource Center by Ohio law firm Bricker & Eckler.

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Rig Count Interactive Map by Baker Hughes, an energy services company.

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Fracking: Gas Drilling's Environmental Threat by ProPublica, an online journalism site.

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