LNG

China National Offshore Oil Corp., the Chinese energy major and with international and domestic LNG interests, has claimed a “major exploration breakthrough” with a natural gas play in ultra-deep waters of the South China Sea.

The Lingshui 36-1 gas field is located in the western South China Sea with an average water depth of around 1,500 metres.

The main gas-bearing play is the Ledong formation with an average burial depth of 210 metres.

CNOOC said the field has been tested to produce over 10 million cubic metres per day of open flow natural gas.

“The exploration in ultra-deep water ultra-shallow gas plays in the South China Sea is faced with world-class engineering and technical challenges,” the company explained.

Success

CNOOC Chief Executive and President Zhou Xinhuai said the successful testing of Lingshui 36-1 was a breakthrough for the exploration in such plays.

“The company will continue to tackle the challenges on the exploration and development of the resources in such plays, to expedite the utilization of natural gas in deep waters,” he added.

“The successful testing of Lingshui 36-1 further expands the resource base for the development of a trillion-cubic-metres gas region in the South China Sea,” stated Zhou.

CNOOC said in May 2024 that production started at its largest natural gas field in the central Bohai Sea offshore China.

CNOOC said start-up was at the Bozhong 19-6 Gas Field in Block 5 .

The Bozhong 19-6 natural gas and condensate field phase I development project is the first 100 Bcm field in Bohai Bay to be put into production.

CNOOC said the field would provide the Beijing-Tianjin-Hebei and Bohai Rim regions with “a more stable and reliable” supply of clean energy.

The company is also using the development to promote the green and low-carbon aims of China.

The main production facilities include a wellhead platform with 10 development wells planned to be commissioned and full production reached by 2026.

CNOOC holds 100 percent interest in the Bozhong 19-6 project and acts as the operator. 

The area around Tianjin in northeast China currently has floating and onshore import terminals and is already the nation’s leading LNG importer, but an expansion of the onshore terminal and the construction of a new facility, the largest in China, will turn the Port into the main China LNG Hub and the biggest in Asia.

According to Customs data, Tianjin accounting for nearly 20 percent of all Chinese LNG imports during the first four months of 2020.

From January to April, LNG imports through the Tianjin port increased 25.6 percent year-on-year to total 3.92 million tonnes.

The LNG imported through the port mainly came from Australia, Russia and Asian nations such as Malaysia and Indonesia.

The Tianjin North onshore terminal is operated by China Petroleum and Chemical Corp., also known as Sinopec.

Sinopec, which plans to more than double its LNG receiving capacities to 41 million tonnes by 2025, currently operates three import terminals.

It is also a partner of US major ConocoPhillips in the Australia-Pacific LNG production plant in Queensland with a contract for more than 7 million tonnes per annum of supplies.

The Chinese company operates three terminal in China at Qingdao in Shandong province, the Tianjin North terminal and the Beihai facility in the Guangxi autonomous region bordering Vietnam.

There has also been a Tianjin floating storage and regasification unit (FSRU) deployed since 2013 by China National Offshore Oil Corp., the nation's largest LNG importer.

The role during the past couple of winter seasons has been carried out by the “Höegh Esperanza”.

Sinopec’s plans include expanding the Tianjin terminal, which guarantees supplies to Beijing during winter, to have a capacity to handle 12 MTPA of imports.

Another import project is being developed at Tianjin by Beijing Gas Group and is known as the Nangang project.

It is currently scheduled to come on line in 2022 with 10 tanks and up to 2 million tonnes of storage.

Beijing Gas has obtained the government's approval to construct the terminal with huge storage tank capacity in the Nangang district of Tianjin City, giving the port area three separate facilities and eventually up to 25 MTPA of capacity, making it the biggest single LNG import centre in Asia.

Nangang will have an initial 5 MTPA of capacity and will then be gradually expanded.

The Asian Infrastructure Investment Bank, backed by the Chinese government, said in December 2019 it was investing $500 million in the new Beijing Gas LNG project.

With a population of around 113 million, the Beijing-Tianjin-Hebei region is one of the most important economic engines within China and has increasing natural gas demand.

Beijing Gas is mainly engaged in city-gas distribution and supplies more than 10 billion cubic metres per annum to the Chinese capital and surrounding areas.

Its new Tianjin terminal will also have a jetty to receive the largest carriers of 260,000 cubic metres capacity.

There will additionally be a pipeline of 230 kilometres to send regasified LNG supplies from the coast to gas storage facilities near Beijing. 

China said that pipeline natural gas from Russia would soon start flowing to help meet future energy needs across several areas of the Chinese Northeast, though supplies during 2020 would amount to less than the equivalent output of one standard Train of LNG.