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Heavy oil development a priority to meet China's demand: report
Platts
Hong Kong
Petroleumworld.com 15 11 06
Oil producers will give priority to heavy oil exploration and production
in the next decade to meet China's increasing energy needs, the official China
Daily reported Tuesday.
"As prices for conventional oil products will remain high in the long
run, heavy oil and alternative oil products will unavoidably become part of
our energy segment in the near future," the newspaper citied Zhang Fengjiu,
deputy chief engineer of mainland offshore producer China National Offshore
Oil Company as saying at the first World Heavy Oil Conference held in Beijing.
"By 2010, (CNOOC's) daily production of heavy oil will surge to 500,000
barrels from the current 200,000 barrels," Zhang said, adding that heavy oil
will account for 60% of CNOOC's total production then.
Heavy oil like oil shale, oil sand and natural asphalt and natural gas
hydrate are becoming increasingly important substitutes for conventional
energy resources worldwide.
Another Chinese company, integrated oil giant PetroChina is also
interested in tapping heavy oil resources, the newspaper cited company vice
president Jia Chengzao as saying. But he said it is still too early for the
company to make any announcement on their business strategy for heavy oil
development.
Jia however noted the high cost of heavy oil exploration and production
and called for more policy support from the Chinese central government.
Bob Lockwood, president and chief executive officer of the
Massachusetts-based Cambridge Energy Research Associates, said PetroChina's
parent China National Petroleum Corporation is also targeting global heavy oil
resources by working closely with his organization.
"We have hammered out a memorandum of understanding with CNPC, mainly
studying options of bringing more heavy oil resources from Canada to China,"
the China Daily quoted Lockwood as saying. "I believe the MoU can expand
beyond that scope to joint research on technology innovation and investment
options."
CNPC and the government of the Canadian province of Alberta initiated the
four-day global heavy oil conference, which opened November 12. Canada is rich
in heavy oil.
Ma Kai, head of China's top economic policy planner National Development
and Reform Commission, said at the opening of the conference: "The government
should encourage and support the development of heavy oil, in line with its
Eleventh Five-Year Plan (2006-2010)."
Unconventional forms of oil and gas, such as heavy oil, are important to
China's energy industry, according to the Eleventh Five-Year Plan. Currently,
heavy oil accounts for 20% of China's total oil reserves, Ma noted.For more news, request a free trial to Platts Oilgram News at
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Platts 14 11 06
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