By Jason Simpkins
China's top oil producer, PetroChina Co. Ltd. (PTR), has raised its production estimate for the Jidong Nanpu oil field. The field is located in the Bonhai Bay area and is one of China's biggest discoveries in recent history.
"We estimate that, eventually, we could have proven reserves of as much as 1 to 1.6 billion tonnes of oil equivalent from the offshore blocks of our Jidong Nanpu oilfield," company vice president Jia Chengzao said in an interview with China Daily.
"Including reserves from onshore the ultimate proven reserves of Nanpu oilfield are expected to hit around 2 billion tons," Jia said.
The Jidong Nanpu oilfield has combined proven, probable and possible reserves of 1.18 billion tons of oil equivalent according to the Ministry of Land and Resources. The government agency said last month that the field contained 445 million tonnes of proven reserves.
Jia told China Daily that it could take five to six years to confirm the new reserves. Meanwhile, PetroChina will make exploration efforts along side extraction work on the current proven reserves.
China will continue to explore its current reserves and search for new rich discoveries as nationwide demand continues to surge. Official estimates suggest that the country could contain as much as 65 billion tons of oil reserves, and approximately 25 trillion cubic meters of natural gas.
The hope is that more domestic oil production will reduce dependence on energy imports. China's net oil imports rose 4.1% year over year to 47% of total consumption last year according to the Ministry of Commerce.
The International Energy Agency (IEA) said in July it expects China's demand for oil to remain at 7.59 million barrels per day (bpd) for the rest of the year before rising to 8.05 million bpd in 2008 and to 9.96 million bpd in 2012. The IEA said China would be the main catalyst for rising oil demand across Asia, accounting for 48.9% of non-Organization for Economic Cooperation and Development demand by 2012.
A report by the agency also said that new refineries and the expansion of existing plants will contribute 2.3 million bpd to the China's supply by the end of 2012. Leading the expansion will be Sinopec, the state owned oil major that has 1.3 million bpd pouring in from new projects and 360,000 bpd from joint ventures.
The IAE said refining capacity growth will accelerate next year with a 200,000 bpd project from Sinopec, a 240,000 bpd project from CNOOC (CEO) and another 260,000 bpd from the expansions of five other refineries.
Also, for long term reassurance, China is establishing footholds in Africa. According to the Telegraph, China now buys about one third of its oil from Africa, mainly from Angola, where a $1.6 billion deal to develop a new field was signed last May. Beijing also built a 900-mile pipeline in the Sudan and investing at least 16 billion. It is also spending another $2.4 billion on a new offshore oilfield in Nigeria.
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