Asia's largest oil refiner, Sinopec, plans to increase its efforts this year to develop oil exploitation in western China.
Wang Jiming, vice-chairman and president of Sinopec, revealed the strategy in an interview with China Daily.
By the end of 2004, Sinopec had discovered 1.21 billion tons of proven oil and gas equivalent reserves in the Tahe Oilfield, of the Xinjiang Uygur Autonomous Region, according to company sources.
The oil giant said, after 20 years of exploration, it had found 1.08 billion tons of oil and 59 billion cubic metres of natural gas in the Tahe Oilfield in Xinjiang's Tarim Basin.
China boasted 3.2 billion tons of proven oil reserves - an equivalent of around 23.5 billion barrels - by the end of 2003, according to British oil giant BP's statistical review.
"China is strengthening the exploitation of oil fields in its western region, aiming to retain the oil reserve balance, as the country has witnessed an annual decrease of approximately 2 per cent in oil reserves in eastern China," said Zhang Jian, an analyst with China Securities.
"However, it seems unlikely that new large oil reserves will be found in western China," said Zhang, "so, Sinopec's focused efforts would be targeting the improvement of existing oilfield's exploitation and production abilities, especially the Tahe Oilfield in Xinjiang's Tarim Basin."
The Tahe Oilfield produced over 3 million tons of oil in 2004, while Sinopec's Shengli Oilfield, in eastern China's Shandong Province, is also the country's second-largest oil field behind PetroChina's Daqing Oilfield in northeastern China, turned over more than 20 million tons of oil, said a Sinopec deputy manager in charge of oil exploitation.
Apart from oil exploitation, the company has been making great efforts to develop its oil refining business and petrochemical products, said company sources.
China's largest oil refining project is expected to be completed and put into operation by Sinopec in Qingdao, in eastern China's Shandong Province, by the first half of 2007, said Sinopec, and the annual oil refining capacity is expected to hit 10 million tons.
The company last week announced the completion of its cooperation project with BP, to establish China's largest petrochemical joint-venture, the Shanghai Secco Petrochemical Co Ltd, which is expected to produce 900,000 tons of ethylene annually, after it becomes operational next March.
(China Daily January 5, 2005)