Discovery of massive oil deposit could be a game-changer for China

China’s largest oil and gas producer CNPC has announced the discovery of an oilfield that could hold over a billion tons of reserves in the northwest of the country.

According to CNPC, the proven reserves at Qingcheng oilfield in the Ordos basin stand at 358 million tons, while its estimated reserves could reach 693 million tons.

A total of 640,000 tons of oil will be produced in the oilfield this year, and the annual output is expected to reach three million tons in the near future, according to Li Luguang, vice president of PetroChina (a subsidiary of CNPC).

The company also reported some 740.97 billion cubic meters of newly added proven shale gas reserves, which have been explored in southwest China’s Sichuan Basin. It plans to produce 7.7 billion cubic meters of shale gas this year and expand the output to over 10 billion cubic meters by the end of 2020.

The Sichuan shale gas blocks have a total proven reserve of 1.06 trillion cubic meters, according to CNPC.

Li said the company will encourage technological innovations and expand the exploration of unconventional energy resources such as shale gas.

Developing domestic crude production is critical for China, which is the world’s largest consumer of oil. Last year, it imported 440 million metric tons of crude oil. The country has stepped up efforts to boost domestic production by 50 percent, increasing it by more than two million barrels per day over the next five years.