Sinopec Says Shale-Gas Output Ahead of Schedule
Post Date: 25 Mar 2014 Viewed: 403
China's largest oil refiner said production at its first commercial shale-gas field is running "ahead of schedule" and that it expects output to reach 10 billion cubic meters a year by 2017.
Monday's statement by state-controlled China Petroleum & Chemical Corp., or Sinopec, comes as Beijing presses ahead with plans to replicate the U.S. shale-gas boom as part of efforts to cut China's dependency on coal.
The company said that the field, known as Fuling, will produce 1.8 billion cubic meters of shale gas this year—nine times the country's total output of shale gas last year.
Sinopec Chairman Fu Chengyu said in the statement that the company made "a number of major breakthroughs" in areas such as technology, research and equipment manufacturing that will give Sinopec an "earlier-than-expected entry" into large-scale commercial shale-gas production.
China has a goal of producing 6.5 billion cubic meters of shale gas annually by 2015 and hopes to ramp up production to 100 billion cubic meters annually by 2020. But according to Wood Mackenzie, China could reach barely one-tenth of its 2020 target. The energy consulting firm says 11 billion cubic meters is more achievable.
According to the U.S. Energy Information Administration, China has 1,115 trillion cubic feet (31.6 trillion cubic meters) of recoverable shale-gas resources, exceeding reserves in the U.S. and Canada combined. But China's complicated geology, scarce water resources and lack of foreign participation are seen as barriers to mass commercialization.
Sinopec said its Fuling field in southwest China has reserves of 2.1 trillion cubic meters. It expects the field to produce 5 billion cubic meters in 2015.