Estimation of China's production efficiency of natural gas hydrates in the South China Sea

Abstract

Natural gas hydrates are expected to be one of the most important unconventional energy resources in the future. China is accelerating its research and trial exploitation of hydrates in the South China Sea, which is where most of China's gas hydrate reservoirs are located. Because it represents a prospective alternative energy source, it is necessary to use the energy return on investment method to evaluate production efficiency. The results show that the average standard energy return on investment is 0.74, the energy return on investment within the boundary from wellhead to processing is 0.58, and the energy return on investment within the boundary from well to utilization is 0.56. The negative net energy suggests that natural gas hydrate is not presently a favourable choice to replace conventional energy sources; thus, the large-scale development of natural gas hydrate requires further technological development. Sensitivity analysis shows that to acquire a strong positive energy return on investment, technological developments must be accompanied by simultaneous increases in ultimate gas recovery and the gas-to-water ratio. Moreover, the choice of proper production methods has an important influence on energy return on investment and should be based on the knowledge of physical properties gained through sufficient geological surveys.