The main natural gas accumulations of the country are located in western and north-central China. According to the concept of natural gas network development in next 10 years there must be two north-south pipelines, two west-east pipelines, four pivot stations and five gas depots in the country. Implementation of this network project starts with the west-east gas transmission project. Total length of this project pipelines is planned to be 9 672 km.
Speaking about natural gas projects in China it’s necessary to mention the Three Gorges Dam project which involves harnessing the Yangtze River. The project is supported by investors from various countries such as Germany, Switzerland, Sweden, France, the UK, Canada and Japan. The abovementioned project is supposed to generate enormous amounts of electricity and its output should be 85TWh/y, which will cover one tenth of current Chinese requirements. Also this dam is designed to stop disastrous floods which have already claimed thousands of lives. Moreover, with development of this dam the navigability on the Yangtze River will also improve. It will allow sailing of much larger ships from Shanghai to Chongqing, upstream from the dam and 2,000 kilometers from the sea. It will also help to develop domestic and export trade of the country. But developing of the dam demanded forced relocation of more than million people that’s why the opposition to the Three Gorges Dam has been intense. But the government of China plans to compensate all losses concerned with the development of the dam.
Natural Gas Pipeline Projects in China
Written by admin on May 31st, 2009China Transnational Pipelines
Written by admin on May 31st, 2009
Apart from expanding of pipeline infrastructure on the domestic market, China searches for opportunities to establish transnational natural gas pipelines with a number of neighboring countries. News reports indicated that in 2005 Kazakhstan’s company KazMunaiGas owned by the government of this country has inquired about possibility of creating natural gas pipeline to China jointly with China National Petroleum Corporation. Company’s officials indicate that such pipeline could be operational in recent years and also it must supply natural gas from Turkmenistan and Uzbekistan.
Recently the possibility of developing international pipeline project that would connect the Russian natural gas grid located in Siberia with China, and possibly South Korea, through the pipeline from the Kovykta natural gas fields located near Irkutsk is being evaluated. The cost of the project will be approximately $12 billion. The total planned capacity of the project is 2.9 Bcf/d, 1.9 Bcf/d of which China would consume and 1 Bcf/d is supposed to be consumed by Kogas, South Korea’s main natural gas company. The China National Petroleum Corporation and Kogas have signed letters of intent for the project in November 2003, but there are several independent analysts who have expressed serious doubts concerning further development of this project because no formal decision has been made on whether to proceed with the project or not.
Hydroelectric of China
Written by admin on May 31st, 2009
Conventional thermal sources remain the dominant fuel for electricity generation in China. But the country is developing a number of projects that will use alternative sources. In 2004 China was second-largest producer of hydroelectric power in the world. The same year, China generated 328 billion kilowatt-hours of electricity from hydroelectric sources, comprising 15.8 percent of its total generation. In recent years these figures have considerably increased because of large-scale hydroelectric projects that had been developed in China. The largest power project is the Three Gorges Dam, which includes 26 separate 700 megawatt generators, for a total of 18.2 gigawatt. Upon completeness, it must be the largest hydroelectric dam in the world. At present time construction on the Three Gorges Dam, which appears to be the world’s largest power project, has been completed up to the intermediate level. The reservoir of the Dam has been filled partially, and generation of electrical power from four of the turbines has begun.
Another large hydropower project involves a great number of dams on the upper portion of the Yellow River. Three provinces Shaanxi, Qinghai, and Gansu have entered into partnership under this project and created the Yellow River Hydroelectric Development Corporation. This project must comprise 25 generating stations with a combined installed capacity of 15.8 gigawatt.
Electricity in China
Written by admin on May 31st, 2009
Rapid growth in China’s electricity demand caused the necessity of developing new electricity networks and building new power stations. To raise investments to this segment of the market the Chinese government in 2002 abolished the monopoly of State Power Corporation and divided this corporation into tree separate units dealing with generation of electricity, its transmission and servicing. Also in 2002, the State Electricity Regulatory Commission, which is responsible for the overall regulation of the electricity sector, was established. Since this reform has been conducted, China’s electricity generation sector is dominated by five state-owned holding companies, which deal with more than 80 percent of China’s generating capacity. Much of the remainder is generated by independent power producers, often jointly with abovementioned state-owned companies. This reform has opened the electricity sector, access to which previously had been strictly limited, to foreign investors. During the 2002 reforms, a State Power Corporation divided all of its electricity transmission and distribution assets among two new companies, the Southern Power Company and the State Power Grid Company. Chinese officials aim to merge 12 regional grids of State Power Corporation into three large power grid networks, precisely a northern and northwestern grid managed by State Power Grid Company and a southern grid managed by the Southern Power Company. Chinese government hopes to develop this large integrated national electricity grid by 2020.
Natural Gas Pipeline System of China
Written by admin on May 31st, 2009
Natural gas pipeline system of China is rather fragmented and consists of several distribution networks. Until recently the most part of natural gas produced was consumed by regions located near the places of its production. For instance, Sichuan province located in the southwest of the country holds a large part of China’s proved reserves and has China’s most developed network of natural gas distribution. Previously the connection of this local network to outside regions was limited. But in recent years in addition to new natural gas discoveries, the demand for natural gas has considerably grown and China undertakes efforts to improve its natural gas transport infrastructure as well as connections between networks. This is particularly important for eastern population centers to which natural gas must be piped from China’s largest natural gas fields which lays in the western part of the country. China Petroleum and Chemical Corporation aims to build a cross¬-country natural gas pipeline on the heels of its large Puguang natural gas discovery located in Sichuan province. Shanghai receives piped natural gas from West-East Gas Pipeline owned by one of China National Petroleum Corporation subsidiaries named PetroChina and also from other regional lines due to which China’s natural gas transport network have greatly improved. But many of independent analysts believe that because of growing demand China Petroleum and Chemical Corporation may choose to build another planned pipeline to Shanghai.
China Natural Gas Resources
Written by admin on May 31st, 2009
Natural gas has never been the major fuel in China. Until quite recently natural gas was used first of all as fuel for supplying industrial process in chemical fertilizer production and as source of energy at oil fields. But nowadays gas consumption is constantly increasing and therefore natural gas production is expected to rise in the following years. According to the latest estimations China’s domestic proven reserves of natural gas are 53.3 trillion cubic feet but some sources asserts that natural gas reserves of the country are considerably higher. At present three gas holding companies are dominating at Chinese market. Every company operates with the help of its numerous local brunches. The China National Petroleum Corporation, the largest gas holding company as to production and amount of gas reserves, operates with the help of its subsidiary named PetroChina and according to its figures, in 2005 the company’s production of natural gas has increased for 28 percent comparing with previous year’s data. Data of China Petroleum and Chemical and China National Offshore Oil Corporations show that in 2005 their gas production has increased for 7 percent comparing to previous year. The main problem of all gas projects in China is the lack of indivisible regulatory system. Currently prices for natural gas are limited by various local regulations. The Chinese government is preparing new legal base for natural gas sector, but this process is very slow and it causes many uncertainties concerning regarding price regulation and taxation issues.
Exploration and Production of Natural Gas Resources in China
Written by admin on May 31st, 2009
The country’s largest natural gas deposits of are located in western and north-central China. Up to the present, the largest of natural gas deposits is located in Sulige field in the Ordos basin in the Inner Mongolia Autonomous Region. The proven recoverable reserves of this accumulation comprise 18.9 trillion cubic feet of natural gas. Chinese companies PetroChina and Total signed a PSC for joint development the South Sulige block. The country’s second large natural gas field, named Kela-2 is located in the Tarim basin, and contains proven reserves of 8.9 trillion cubic feet of natural gas.
Recently a number of new natural gas accumulations have been developed, and this will help to increase country’s natural gas production in the coming years. In 2006 China Petroleum and Chemical Corporation announced that in northeast China three new natural gas deposits containing approximately 2.1 trillion cubic feet of recoverable reserves had been discovered. Later this company announced about more important discovery made in the southwestern province of Sichuan and named the Puguang natural gas field. According to official assessment of these reserves made by China’s State Ministry of Land and Resources this deposit contains 8.9 trillion cubic feet of natural gas. Its initial production capacity is approximately 140 Bcf per year, rising up to 280 Bcf by the year 2010. In addition PetroChina, the major subsidiary of China National Petroleum Corporation, the largest gas holding company as to production and amount of gas reserves, at the end of 2005 announced that it had discovered an additional and very promising natural gas reserves at the existing Daqing oil and gas field in northeast of China’s Heilongjiang province.
China Overseas Interests
Written by admin on May 31st, 2009
China is expecting its resources to be used one day, so the country is interested in oil exploration and production abroad. China National Petroleum Corporation has gained such interests in 21 countries. In 2005 this corporation has announced that in following 15 years it intends to invest $18 billion in foreign oil and gas assets. The corporation has already invested more than $8 billion in Sudan oil sector, and this includes capital investments in pipeline to the Red Sea, the length of which will be 900 miles. In 2005 the above-mentioned corporation has finally purchased PetroKazakhstan, become owner of 11 oil fields and has acquired right of ownership for seven exploration blocks. In addition at the end of 2005, to this purchase the completion of the 600-mile Sino-Kazakh oil pipeline has been added. By the end of 2006 it had been delivering to China approximately 200,000 bbl/d of crude oil.
The other Chinese company named Sinopec has also searched for opportunities to explore and produce oil in foreign countries. In summer 2006 the company owned 97 percents of Udmurtneft stocks. At present Udmurtneft produces 120,000 bbl/d of crude oil and 1 billion barrels of the company’s proven reserves are kept in Russia. In 2004 Sinopec signed a Memorandum of Understanding with the government of Iran and due to this it acquired a 51 percent stake in the Yadavaran oil field. Also the company owns 40 percent stake in Northern Lights oil sands project in Canada and in 2010 this project is expected to produce a total of 100,000 bbl/d of synthetic crude oil.
China Oil Exploration Activities and Situation in Oil Consuming Market
Written by admin on May 31st, 2009
During 1950s China imported relatively small amount of oil from former USSR, but in the middle 1960s it refused to take advantage of import because of discovering of large oil deposit in Heilongjiang province. With subsequent oil deposits discoveries, especially in Shandong and Hebei provinces, the China’s capability to produce oil almost doubled. At the beginning of 1980s the country started to explore its offshore areas intensively and this time trial oil well drilling of South China Sea water areas has begun. But there up to the present there only a few oil deposits of relatively small economic value have been discovered. In 1997 China’s total reserves of oil amounted to 94,0 milliards tones. At present China’s government focuses its attention on Xinjiang province where several undiscovered and promising sedimentary rocks are located.
Since 1993, China’s oil industry is concentrated mainly on meeting requirements of domestic consuming market. Consumer prices for petroleum products are regulated by the government and they depend upon location and kind of consumers. The government of the country has limited the prices for finished petroleum products. Even in spite of the fact that Chinese government has made several decisions to increase prices for such kind of products, still prices for such products on international markets are higher than in China. So, the Chinese government has to provide refining companies with subsidies to fill the gap between low domestic rates and high prices for such products on international market.
Petroleum industry of China
Written by admin on May 31st, 2009
China is one of the largest oil consumes in the world and is third-largest Importer of oil after the U.S. and Japan. In spite of its consuming capability, the country produces significant amount of oil by itself and has developed considerable oil reserves. Over the last ten years China’s oil industry has undergone major changes. More then twenty years ago the Chinese government has reorganized oil and gas assets owned by the state into two companies: the China National Petroleum Corporation (CNPC) and the China Petroleum and Chemical Corporation (Sinopec). Every such company has a number of local subsidiaries. The other major state enterprise operating in this business sector is the C (CNOOC). This company deals with offshore exploration and production and now it develops nearly 15 percent of China’s domestic crude oil production. Now the government of the country owns the controlling interest of each of these companies. Generally, CNPC and its brunches are dominating in the north and west of the country, affiliates of Sinopec are gathered in the south, and CNOOC is operating in offshore regions. For many years CNPC has concentrated its major forces on exploration of oil and gas and, of course production of there resources and Sinopec has focused on such subsequent operations as refining and distribution. At present such pattern has been changed as in 1990s it had undergo some restructuring. At present CNPC and Sinopec control practically all of country’s oil refineries industry and the domestic network of pipelines