CNOOC’s discovery in the South China Sea has more than 100 Bcm in reserves
China National Offshore Oil Corporation’s (CNOOC) deepsea natural gas discovery in the northern part of the South China Sea has certified reserves exceeding 100 Bcm (3,531 Bcf), reports Chinese state television. The size of the discovery makes it one of China’s biggest offshore finds and would mark a breakthrough in drilling high-temperature and high-pressure reservoirs, reports Reuters.
CNOOC first announced the discovery last August after striking high flows of gas in the Lingshui 17-2 well, with production of 56.5 MMcf/day. According to the company, the well encountered gas pay zones with a total thickness of 55 meters (approximately 180 feet) with a total well depth of 3,510 meters (approximately 11,515 feet). The well is located 150 kilometers (94 miles) south of the Chinese island province of Hainan.
Xizhou Zhou, senior director and head of China for IHS Energy, said the find was not monumental, however. The 100 Bcm find is a “decent amount, but not that substantial,” he said. The find is the equivalent to about six to seven months of Chinese gas supply demand currently. By comparison, the Marcellus Shale in the United States has estimated reserves of 64,900 Bcf, or approximately 19,780 Bcm.
“In addition, new discoveries often take years to develop, so by the time this gas starts to flow, the Chinese gas market could be much bigger than it is today,” says Zhou.
Development poses a complex problem
Not only will a new offshore development take years to reach production, the issue is further compounded by overlapping claims to the space. The South China Sea is one of the busiest shipping routes and a patchwork of overlapping claims by governments including China, the Philippines, Malaysia, Vietnam and Taiwan.
A Chinese drilling rig placed in contested waters two months before CNOOC’s initial discovery triggered a wave of violent protest among the Vietnamese, leaving at least two Chinese workers dead and 140 injured. China claims virtually all of the South China Sea, but trying to develop an offshore gas field could trigger more repercussions over ownership of the resources.
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