West China oilfield sees rise in reserves

West China's Tarim Oilfield registered a record 497 mm tons of 3P (proved, probable and possible) reserves of oil and gas in 2009, the company has announced. Last year was the fourth consecutive year that the field in Xinjiang Uygur autonomous region, China's largest natural gas supplier, developed more than 400 mm tons of 3P reserves, said Li Baozhong, publicity officer with the PetroChina Tarim Oilfield Company.
The reserves would guarantee the oilfield as a "significant factor" in supply central and eastern China with much-needed energy, he said. He said that the amount of output would hinge on downstream demand and overall supply planning for China's second West-East natural gas pipeline.

The 8,653-km-long pipeline, starting from Horgos in Xinjiang, through Shanghai and Guangzhou, and ending in Hong Kong, is to enter full operation by the end of 2011. But the western section between Horgos and Zhongwei in north-western Ningxia Hui autonomous region has been in use since mid-December. Thepipeline will supply homes in Beijing by mid-January.
Company statistics show the Tarim Oilfield had stabilized its annual oil and gas equivalent production at around 20 mm tons. In 2009, its crude oil output was 5.54 mm tons while natural gas output reached 18.1 bn cm, up 700 mm cm year-on-year and accounting for about 25 % of China's total.

Li denied a report that the company was to invest yuan 10 bn ($ 1.5 bn) in oil and gas exploration, but he admitted there would be an investment this year and the amount was confidential.
The company said it had explored 27 oil and gas production areas with expected reserves of 3.5 bn tons since it began operating in China's fourth largest oil production base 20 years ago. Its accumulated oil output was 78 mm tons and gas production was 73.6 bn cm over the past two decades. Tarim, covering 560,000 sq km, has about 16 bn tons of oil and gas reserves, but only 12 % have been proved.

Over the past five years, it has supplied 60 bn cm of gas via a major pipeline to more than 3,000 businesses and 300 mm people in 80 cities, including Beijing and Shanghai. In 2020, Tarim is expected to produce 50 mm tons of oil and gas, including 50 bn cm of natural gas.
China consumed 80 bn cm of natural gas in 2008, about 3.2 % of the total consumption of primary energies. In developed countries, the rate is about 25 %. Gas demand is expected to hit 110 bn cm in 2010. West China oilfield sees rise in reserves.