China National Offshore Oil Research Articles

The Role Of China And The United States In The Global Economy Of The 21st Century

The world is characterized by brutal global competition. When talking about competition during much of the 80s and 90s, we generally refer to the triage of Western European, Japanese, and U.S. firms. Today, we have to add firms from Brazil, Chile, China, and India to this elite bunch. This competition is good for the consumer -- prices of manufactured goods have been kept in check, and there is a general feeling of economic prosperity around the world. According to a recent article in The Economist global output has grown by over 4.3 % annually. The growing middle class in India and China has recorded the sharpest increase in the number of billionaires in the last decade; therefore the world has every reason to feel optimistically euphoric, even if China and India will reap a bigger share of the economic pie. In the words of Drucker, India and China are rapidly transforming their economiesthey can now produce technologically sophisticated and financially rewarding offerings that are diminishing American standards. (Drucker, 2004) The concern with the advent of China has prompted more protectionist oriented legislation against China: textiles. The U.S. Congress also blocked a recent attempt by Chinas China National Offshore Oil Corporation (CNOOC) to acquire Chevron. A recent Harris Poll indicated that 40% of the people surveyed believe that China will be stronger than the U.S. within a decade, and over 50% believe that China will have a negative effect on the U.S. economy.

Social responsibility and resource extraction: Are Chinese oil companies different?

In order to meet China’s rapidly increasing demand for oil, Chinese oil companies have been investing in oil production around the world. This article addresses one specific aspect of the more generalized fears expressed about China’s increasing demand for natural resources which is the impact that its oil companies will have on the corporate social responsibility (CSR) movement. In doing so, it limits its analysis to the three main Chinese oil companies: the China National Petroleum Corporation (CNPC), the China Petroleum and Chemical Corporation (Sinopec) and the China National Offshore Oil Corporation (CNOOC) and their investments in sub-Saharan Africa.While acknowledging that Chinese oil companies are unlikely to push resource-rich governments to promote democracy or respect human rights, fears of their negative impact on CSR in the resource extractive industries are misconceived and overblown. Such fears are based on fundamental misconceptions of what CSR can do and how much its Western proponents have achieved. They are also based on misconceptions of the role of Chinese oil companies in global energy markets and they do not withstand a critical comparative evaluation of the respective CSR performance of Western and Chinese oil companies. In addressing the question posed in our title – are Chinese oil companies really different on CSR? – the answer is yes, but the differences are not all that big nor do they matter all that much.

Technology Focus: Heavy Oil (March 2010)

Technology Focus What does the term “heavy oil” mean to you, the broad JPT readership? There are of course the various formal definitions that are tied mainly to API-gravity values (i.e., commonly 22°API), while others reflect both oil density and viscosity (preferentially referring to in-situ conditions). In general, however, recent literature suggests that heavy oil means quite different things to different people throughout this industry because it is used to cover a wide spectrum of reservoir conditions and field developments. Only a decade or so ago, papers written about heavy oil typically referred to developments in Canada, China, USA (California), or Venezuela. Now, however, papers describing heavy-oil projects cover a much broader range, both geographically and in terms of the reservoir conditions involved, with a key distinction between onshore and offshore developments. Now, various types of onshore heavy-oil developments are under way in many countries and regions including the Middle East (Kuwait, Oman, and Saudi Arabia), Russia, Africa (Chad, Nigeria, Tunisia, and Libya), USA (Alaska), India, and Europe. Over the past few years, interest has grown rapidly in developing heavy-oil deposits off-shore Brazil, Mexico, Africa, China, Italy, Trinidad, Cuba, and elsewhere. These offshore fields include both carbonate and sandstone reservoirs with in-situ oil viscosities typically less than 400 cp. While such viscosity values are quite low relative to traditional onshore heavy-oil developments, they certainly can present significant technical challenges in an offshore environment. The diversity among these recent heavy-oil developments is significant in terms of the recovery strategies being pursued and the technical challenges that must be overcome. These challenges include choice of recovery method, reservoir characterization and performance, complex-well-design and well-integrity considerations, production and artificial-lift difficulties, as well as fluid-processing difficulties. The papers included in this feature were selected to showcase the wide range of heavy-oil developments under way throughout the world and the novel strategies and technology pursuits that go along with them. Heavy Oil additional reading available at OnePetro: www.onepetro.org PETSOC 2009-067 • “Evaluation of Recovery Technologies for the Grosmont Carbonate Reservoirs” by Q. Jiang, SPE, Osum Oil Sands Corporation, et al. SPE 113625 • “The Zatchi B Heavy-Oil-Reservoir Development: The Unique Challenges of the TAML6 Multilateral Well ZAM-408ML” by L. Tealdi, SPE, Eni Congo, et al. SPE 115240 • “Key Technologies of Polymer Flooding in Offshore Oil Field of Bohai Bay” by W. Zhou, China National Offshore Oil Corporation, et al. SPE 121381 • “When Water Means Oil: Block 16 Case History” by C. Correa Feria, Repsol, et al.

China and the Energy Equation in Asia: The Determinants of Policy Choice (review)

Reviewed by: China and the Energy Equation in Asia: The Determinants of Policy Choice Alfred Tat-Kei Ho (bio) Jean A. Garrison . China and the Energy Equation in Asia: The Determinants of Policy Choice. Boulder, CO: Lynne Rienner Publishers, 2009. 185 pp. Hardcover $59.95, ISBN 978-1-935040-05-0. The book covers an increasingly important topic — China's energy policy and its implications for Asia and the United States. Jean Garrison treats the subject with a balanced and pragmatic perspective. Many studies have been published to look at different countries' energy policies from a climate change or environmental policy perspective. Garrison takes a different approach and looks at China's energy policy and its implications from the perspectives of foreign policy and bureaucratic politics. Thus, the policy is framed as a security and geopolitical concern — how China tries to safeguard a stable and sufficient supply of energy resources from different countries when the dominant sources of energy, such as oil, coal, and natural gas, are being depleted each day and are controlled by a few countries and regions. This situation naturally creates cause for international conflicts and scrambling for resources. However, by looking at China's internal dynamics and its relationships with its neighboring states and with the United States, Jean Garrison clearly abandons the China threat theory and asserts a pragmatic tone: This study recognizes the geopolitical challenges that states face but also incorporates a perspective of shared vulnerabilities and possible shared interests that can promote cooperation. Such a definition of energy security evaluates a country's access to other energy sources such as natural gas, coal, and renewable energy (each with different geopolitical and social calculations), as well as the linked sustainable development, environmental, and climate questions. (p. 16) Chapter 1 contextualizes China's energy policy by analyzing demand trends from China, the rest of Asia, the United States, and other countries. This context sets the stage for a more in-depth examination of regional politics and "energy games" in Central Asia, East Asia, and Southeast Asia (chapters 3-5 of the book). In these regions, China is often viewed by policymakers as a trading partner, a collaborator, and a potential threat (at times simultaneously). The author explains the strategic importance of each of these regions to China's energy security concerns; the key historical events in the recent decade, such as international agreements and business deals between these countries and China; and the sources of interest conflicts and potential rivalry among them. Moreover, the author analyzes the domestic side of regional energy policies by highlighting the key roles played by China's energy conglomerates, such as China National Petroleum Corporation, PetroChina, and China National Offshore Oil Corporation. Overall, these chapters provide a broad and informative review of the core issues and geopolitical concerns behind China's engagement in these regions, which is motivated by energy security issues. [End Page 118] Besides looking at the international relations and foreign policy context of China's energy policy, the author devotes a chapter (chapter 2) to the domestic and bureaucratic politics that helps shape China's foreign relationships and energy policies. To the author, politics is an important missing piece the understanding of China's energy policy. She suggests, Within foreign policy analysis, the bureaucratic politics perspective argues that multiple interests can be at play, and multiple stakeholders often weigh in on a country's foreign policy decisions. The circumstances illustrate a situation where different definitions of the "national interest" can evolve depending on who is involved in the policymaking process. . . . From this point of view, digging deeper into China's energy interests and policymaking processes becomes the missing piece of the puzzle to address. Because energy crosses security, development, and environmental policy lines, among others, it can be influenced by multiple needs and interests. (p. 14) The approach taken in the book to study China's administrative apparatus related to energy policy is similar to the framework of "fragmented authoritarianism" developed by Kenneth Lieberthal and David Lampton. In chapter 2 and other places in the book, the author discusses the roles of multiple ministries, departments, and state-owned enterprises, and the gaming dynamics between the central and...

Ekspansja gospodarcza Chin w Afryce

In the recent years China has intensified its economic cooperation with the African countries in order to secure the new resource market. The trade between China and Africa has been expanding very quickly in the last few years and in September 2008, China’s customs authorities released an estimate of the value of bilateral trade at more than 100 billion dollars. For comparison the value of bilateral trade between China and Africa was in 2001 only 10,8 billion dollars. There also has been an enormous inflow of the Chinese direct investment into Africa. The most spectacular case of such investment was the take-over in October 2007 by the Industrial and Commercial Bank of China, one of the “Big-Four” state owned banks, a 20% stake in South Africa’s Standard Bank for 5,46 billion dollars. Earlier, in January 2006, state-controlled oil company China National Offshore Oil Corporation paid 2,3 billion dollars for a 45% stake in a Nigerian oil field. China’s economic expansion in Africa in viewed as the desire of that country to increase its presence on the black continent. Chinese authorities use the “noninterference” approach and are willing to form close partnerships with governments in Africa, which are considered unsavoury in the West, such as those of Sudan and Zimbabwe. Additionally, China’s aid and trade packages are not tied to any requirements for reform or government transparency and therefore undermine – mostly Western – efforts to encourage good governence. There are, however some fears that China will be a neocolonialist and simply use Africa as a resource market, taking away raw materials and selling fishined goods back to Africa, leaving Africans with depleted resources and no industry. There also are concerns that Chinese factories and mines in Africa will either use large numbers of Chinese workers instead of locals, or underpay and exploit local workers. The leaders of African states are learning from economic cooperation with China how to manage the relationship with China and adapt some elements of the Chinese economic model, different from the Western model, which in Africa has not yielded much fruit. However the African states should shape the common policy vis-a-vis cooperation with China in order to secure the best possible advantages from that cooperation.

Chinese Firms Emerge as Formidable Competitors in Global E&P

Guest editorial When I first came to work in the People's Republic of China back in 1979, domestic production exceeded demand by a comfortable margin. Although production has risen steadily over the past three decades, China has been consuming more oil than it produces since 1993. In 2007, China consumed about twice the amount of oil it generated (BP 2008). Meanwhile, demand continues to grow. How are Chinese oil firms trying to meet the nation's surging energy requirements? Expanding Domestic and International Activities China's three main state-owned oil companies—Sinopec, China National Petroleum Company (CNPC), and China National Offshore Oil Company—are fully integrated upstream and downstream, and now compete with one another both domestically and internationally. Domestically, they have explored every viable sedimentary basin in China, using an increasingly sophisticated arsenal of oilfield technologies. Over time, China's oilfield service companies have acquired tools and equipment comparable with those available anywhere else in the world. Like other countries, China's remaining reserves have become more difficult to find, often in deeper or subtler plays, hostile terrains, and environmentally sensitive areas. As seismic and drilling technologies have evolved, Chinese oil firms have gone back and re-evaluated many old fields with new methods and fresh ideas. Reservoirs considered marginal or unproductive in the past are yielding additional reserves. Nevertheless, demand continues to outstrip China's domestic capacity. As a result, the Chinese have been moving into virtually every key oil and gas province in the world, either as an active player or a nonoperating partner. China's oil companies have forged deep relationships with the major international oil companies (IOCs) and the big oilfield service providers both at home and abroad. They have proven themselves competent peers of the IOCs, and have partnered successfully with many national oil companies. Chinese seismic and drilling contractors pride themselves on being able to perform efficiently in a variety of remote and hostile regions. For example, BGP, CNPC's geophysical service company, operates more than 100 crews in 24 countries in terrain as diverse as mountains, deserts, gravel plains, jungles, swamps, marshes, shallow water, and transition zones. Since 2006, they have been operating offshore as well (BGP). In general, Chinese state-owned enterprises appear willing to accept higher risks than some of their international counterparts. Leveraging their association with the government, they have entered a number of situations that the IOCs might normally avoid. If they believe there is significant potential to be exploited, these Chinese companies carefully analyze their options and when they decide to act, they go full speed. This, of course, is providing China with important opportunities to fill its domestic energy needs.

Your SPE: Enhancing the SPE Value Proposition in China

President's column One of my last trips as President-Elect was to China. My visit was marked by two key events: the recent tragic earthquake in Sichuan and the excitement leading up to the Olympics. These topics were on every agenda, together with SPE and the oil industry, of course. I went to China to talk to company leaders and representatives of four of the five active sections about how the industry might develop over the next 20 years and how SPE can help it to respond to a rapidly changing world. There must be millions of engineers in this country with a population of over 1.3 billion people. But total SPE membership is just 1,740, with most members belonging to the Beijing, Daqing, Northern China International, and Southern China sections. My challenge in China was to communicate SPE's value proposition: SPE is not just about conferences and workshops but has a role as a relationship broker between engineers and the providers of knowledge. It provides a vehicle for individuals and companies to maximize business and networking opportunities through events, publications, and electronic media—a concept that the senior management of the Chinese NOCs finds difficult to understand. They view SPE membership as valuable at a corporate level, offering "a window on the external world." The senior company executives have calculated exactly how many members they need to ensure an effective distribution across their organizations of JPT magazines, access to the eLibrary, and notice of upcoming workshops and conferences. They are very supportive of SPE's sister organization in China, the Chinese Petroleum Society, which publishes many Chinese technical papers and hosts events around the country. Dues of members in the Beijng, Daqing and Southern China sections are paid by their companies. Membership numbers will increase only as a result of further added value rather than from lower dues. So, how do we boost membership in China? Discussions during my meetings offered a few solutions. All sections requested that we set up a program of regional (meaning Chinese) Distinguished Lecturers and a Chinese-language professional network targeting those nationals who work outside China. However, Chinese translations of SPE papers was not seen as adding value, particularly in the China National Offshore Oil Corporation, where the objective is to encourage engineers to learn English. I am one of SPE's main advocates of further globalization of the Society, so how do I match that objective with listening to local needs that call for a more insular approach, which is totally in keeping with the Chinese culture and which we must respect?

AKPO: A Giant Deep Offshore Development

Summary All deep water offshore projects are challenging. They are large developments, difficult to implement and often beyond the limits of proven technologies at their inception. AKPO field is located in block Offshore Mining License (OML) 130,200 km offshore Nigeria in 1400 m of water. At plateau production, AKPO will produce and export 175,000 B/D of condensate and will export, at startup, 320 MMscf/D of gas to Bonny NLNG plant, onshore Nigeria. AKPO reservoirs characteristics have greatly influenced the development scheme while still making it technically and economically viable. AKPO reservoirs consist in a 620-million-recoverable-barrels accumulation of a critical fluid made of very light oils up to 53°API and classified as condensate, with well head shut-in pressures up to 400 bars, fluid temperature up to 116°C at wellhead, and very high gas liquid ratio (GLR). AKPO is not only a giant condensate field, but also a gas field with 1 Tcf planned gas export. With such particular reservoir conditions, the AKPO development scheme is very challenging and maximizes the use of proven and generic technologies whenever possible. The development is taking place at a time when the supplier market is very buoyant. This, in turn, has created additional challenges with respect to the availability of skilled resources and obtaining quality products on time. The paper addresses the challenges of AKPO development and in particular some of the key technical issues. A unique hybrid condensate production/gas export development scheme which maximizes hydrocarbon recovery Reservoir management requiring massive pressure maintenance facilities, extensive use of intelligent and selective completions, and subsea multiphase flow measurements A development drilling strategy and well architecture. A subsea layout compromise, aiming at maximum reliability and availability. Extensive qualification and testing program of equipment to meet with the reservoir conditions. An FPSO concept pushed to the limit to handle high volume of high-pressure (HP) fluids together with a very large gas inventory. The securing of resources in terms of dry dock slot, marine spread and deep offshore drilling units in a buoyant market. TOTAL, with 24% interest, is the operator on OML 130 on behalf of Petrobras of Brazil, Sapetro of Nigeria, China National Offshore Oil Corporation of China (CNOOC), and Nigerian National Petroleum Corporation (NNPC) of Nigeria. AKPO achieved Project sanction on 25 April, 2005, when OML 130 was awarded by the Nigerian authorities. AKPO is currently under development with drilling and construction underway, with first production planned before the end of 2008.

Studies on mechanism of sand removal from crude oil

Abstract Numerical simulation and experimental research on sand removal was performed. The sedimentation mechanism of sand particles of various diameters was investigated under different oil/water ratios and oil viscosities. Moreover, commercial CFD software FLUENT was applied to simulate numerically gravitational sedimenttation separation. Through the comparison between simulation and experimental results, a kind of high-efficient sand-removal method was put forward. The work was completed jointly by the Institute of Mechanics, CAS and China National Offshore Oil Corporation during the “tenth-five-year” period.

How to Improve U.S.-China Relations in the Wake of CNOOC

The increasingly confrontational approach the U.S. Congress is taking toward China, as witnessed by the surge of anti-China legislation and by the excessive politicization of the proposed merger between CNOOC Ltd., a subsidiary of state-owned China National Offshore Oil Company, and Unocal is leading to “creeping protectionism,” often in the guise of protecting U.S. national security. Although it is proper to criticize China for its human rights violations and its lack of a transparent legal system, we should not ignore the substantial progress China has made since it embarked on economic liberalization in 1978. A policy of engagement—or what Hu Jintao, president of the People’s Republic of China, calls “peaceful development”—is a necessary condition for constructive U.S.-China relations. Although China’s competitiveness does pose a threat to certain U.S. economic interests, it also benefits American consumers and exporters. Protectionism would harm both the United States and China and would increase the likelihood of conflict. Hardliners would gain at the expense of more reasonable voices. To avert the risk of conflict, the United States needs to treat China as a normal great power, not as an adversary, and ensure that only those commercial transactions that genuinely threaten national security are

Chinese bid for Unocal sparks fears of global clash over energy resources

A bid by China's state‐owned offshore oil company for a privately‐owned US upstream corporation has raised fears of a Chinese takeover of several other foreign companies as Peking tries to secure oil and gas reserves to fuel the country's booming economy. The China National Offshore Oil Corporation (CNOOC) has offered $19.6 bn for the California‐based company, Unocal, the eighth‐largest upstream company in the US in terms of reserves. The bid trumps an earlier one of $18.4 bn by US major Chevron, which had been accepted by Unocal's board and appeared to have the backing of many leading political figures in the US.

OIL SPILL RESPONSE ORGANIZATION DEVELOPMENT—BOHAI SEA—CHINA

ABSTRACT Oil spill response along the coast of China has been recognized as an important issue by the Chinese government. The Bohai Sea in particular, is an area of high oil exploration and production activity, with offshore developments comprising platforms and FPSO's (floating, production, storage and off-loading) together with associated vessels and pipelines. Major shipping lanes from the East China Sea into China also pass through the offshore oil fields. For the oil companies operating in the area, the prospect of an accidental oil spill is a concern from both a domestic and international perspective. In 2000, the companies involved in upstream activities in the Bohai Sea began discussions with the China National Offshore Oil Corporation (CNOOC) to develop an oil spill response capability. Led by ConocoPhillips, the international oil companies worked with CNOOC to build a framework for developing an oil spill response organization (OSRO) to provide appropriate services within the Bohai Sea. The key tenet for this OSRO, was to be able to perform to international standards. In 2002, the CNOOC executive management, through its subsidiary, Bohai Corporation(COOBC) committed to establishing a commercial oil spill response organization, Bohai Environmental Services Ltd. (BES). The BES remit is focused on the Bohai Sea, but with the eventual goal of providing response services along the wider China coastal region and eventually fulfilling a longer term vision of expanding into the international market. This Paper describes the standards required by the international oil companies and how BES was conceived and organized to meet them.

Deep crustal structure of Baiyun Sag, northern South China Sea revealed from deep seismic reflection profile

This paper discusses deep crustal architecture of the Baiyun Sag of the Pearl River Mouth Basin, northern South China Sea based on velocity analysis, time-depth conversion and seismic interpretation of the deep seismic reflection profile DSRP-2002. The profile was acquired and processed to 14 S TWT by the China National Offshore Oil Corp. (CNOOC) in 2002. It extends across the Baiyun Sag of the Pearl River Mouth Basin, from the northern continental shelf of the SCS to the deepwater province. As the first deep seismic reflection profile in the Pearl River Mouth Basin, this profile reveals seismic phases from basement down to upper most mantle. The Moho surface appears in the profile as an undulating layer of varying thickness of 1–3 km. It is not a single reflector interface, but a velocity gradient or interconversion layer. The crust thins stepwisely from the shelf to the continental slope and the abyssal plain (from north to south), and also thins under depocenters. The crustal thickness is only 7 km in the depocenter of the main Baiyun Sag, which corresponds to a Moho upwelling mirroring the basement topography. In the lower slope and the ocean-continental transition zone of the southernmost portion of the profile, three sub-parallel, NW-dipping strong reflectors found at depths around 10–21 km are interpreted as indications of a subducted Mesozoic oceanic crust. Crustal faults exist in the northern and southern boundaries of the Baiyun Sag. The intense and persistent subsidence of the Baiyun Sag might be related to the long-term activity of the crustal faults.

Pressure Prediction for High‐Temperature and High‐Pressure Formation and Its Application to Drilling in the Northern South China Sea

Abstract There are plentiful potential hydrocarbon resources in the Yinggehai and Qiongdongnan basins in the northern South China Sea. However, the special petrol‐geological condition with high formation temperature and pressure greatly blocked hydrocarbon exploration. The conventional means of drills, including methods in the prediction and monitoring of underground strata pressure, can no longer meet the requirements in this area. The China National Offshore Oil Corporation has allocated one well with a designed depth of 3200 m and pressure coefficient of 2.3 in the Yinggehai Basin (called test well in the paper) in order to find gas reservoirs in middle‐deep section in the Miocene Huangliu and Meishan formations at the depth below 3000 m. Therefore, combined with the “863” national high‐tech project, the authors analyzed the distribution of overpressure in the Yinggehai and Qiongdongnan basins, and set up a series of key technologies and methods to predict and monitor formation pressure, and then apply the results to pressure prediction of the test well. Because of the exact pressure prediction before and during drilling, associated procedure design of casing and their allocation in test well has been ensured to be more rational. This well is successfully drilled to the depth of 3485 m (nearly 300 m deeper than the designed depth) under the formation pressure about 2.3 SG (EMW), which indicate that a new step in the technology of drilling in higher temperature and pressure has been reached in the China National Offshore Oil Corporation.

BUILDING ON THE BAY

UNTIL YOU SEE IT, IT'S DIFFICULT to grasp how large the $4.3 billion petrochemical complex that Shell and China National Offshore Oil Corp. (CNOOC) are building at Daya Bay in southern China really is. You'd need a helicopter to take a good photo, says Nick Wood, Shell's Beijing-based spokesman. There are now 16,000 workers at the site, each working at least 60 hours a week to get the project fully operating in early 2006. The complex is within budget and within schedule, states Simon Lam, CEO of the joint-venture company, CNOOC & Shell Petrochemicals Co. (CSPC). As the work proceeds, a question looms about the fate of the oil refinery that Shell has wanted to build in China since the 1980s. Shell had proposed an ambitious dual refinery/ethylene cracker. However, after authorities in Beijing denied permission for the refinery, the company eventually decided to build only the cracker, although, through CSPC, it did ...

SUBMARINE PIPELINE PROJECT FOR CHINA

Hyundai Heavy Industries’ Offshore & Engineering Division has won a US$130 million contract to construct a submarine gas pipeline from China Petroleum and Chemical Corp (SINOPEC) and China National Offshore Oil Corp (CNOOC). This is a short news story only. Visit www.worldpumps.com for the latest pump industry news.

Submarine pipeline project for China

Hyundai Heavy Industries’ Offshore & Engineering Division has won a US$130 million contract to construct a submarine gas pipeline from China Petroleum and Chemical Corp (SINOPEC) and China National Offshore Oil Corp (CNOOC). Visit www.filtsep.com for the latest filtration industry news

Liuhua 11-1 Field, South China Sea: A shallow carbonate reservoir developed using ultrahigh-resolution 3-D seismic, inversion, and attribute-based reservoir modeling

Liuhua 11-1 Field is 130 miles southeast of Hong Kong in 1000 ft of water (Figure 1). The field, discovered in 1987, is being developed by the consortium of BP Amoco, China National Offshore Oil, and Kerr-McGee. The reservoir zone at 3850 ft subsea is producing 16–22° API oil through 25 long-radius horizontal wells. Success depends on limiting bottom-water production, which in turn makes accurate reservoir description critically important. Figure 1. Pearl River Mouth Basin index map and geologic setting. To better define reservoir heterogeneity, an ultrahigh-resolution 3-D seismic survey was acquired in July 1997. Acquisition was conducted during calm seas with short (1500 m) streamers and shallow (3.5 m) tow depths. The 180-Hz field data, enhanced during processing, produced peak frequencies of 240 Hz. Approximately four million traces were processed at a bin spacing of 5 × 5 m over 100 km2. The seismic data were first converted to acoustic impedance by using geologically constrained inversion techniques and then to porosity based on a linear impedance versus porosity relationship. Drilling data were integrated to create detailed maps of reservoir structure and stratigraphy. Petrophysical data and modeling were combined with the seismic inversion to create a spatial distribution of porosity, permeability, and saturation. Faults, fractures, and solution-collapse phenomena were analyzed using coherence technology. Complex attribute analyses added additional understanding of rock matrix continuity. This information has been used to build reservoir characterization and simulation models, that have been tuned and validated using history matching, to predict future reservoir performance. The geoscience interpretation and characterization of the reservoir for simulation are the focus of this paper. Liuhua reef carbonates are composed largely of shallow-water foram-algal packstones and boundstones belonging to the Miocene Zhujiang Formation. In-place reserves are projected at 1.2 billion barrels over the entire closure. Only the western part of …

Hydrocarbon Prospectivity of the East China Sea Basin, Offshore China: A Small Independant's View: ABSTRACT

The East China Sea Basin located offshore China, consists of a series of rift-related northeast-southwest trending fault blocks, tilt blocks, and half-graben structures characterized by en echelon type faulting which are key features for enhancing prospectivity in the area. A series of recent discoveries by China`s Ministry of Geology (MOG) in the eastern portion of the basin (the Xihu Trough), have confirmed that significant potential does exist within the basin proper. However, exploration success within the western portion of the basin (the {open_quotes}Inner graben system{close_quotes}), has so far eluded foreign companies who were awarded eighteen lease blocks by the China National Offshore Oil Corporation (CNOOC) in 1993. Key risks are perceived to be source rock related. Five of the eighteen leases totalling 23,500 square kilometers, are currently held and operated by Primeline Petroleum Corporation (PPC), a small independent based in London. Recent studies indicate the southern-most lease (Block 32/32) has significant potential for a future commercial discovery. Two wells, Lingfeng-1 and Shimentan-1, were drilled within the block by MOG in 1985 and 1987. The Lingfeng-1 well, encountered and recovered high quality crude (API = 48 degrees) but was never properly tested for commerciality. Both wells encountered good quality source andmore » reservoir rocks. A total of eleven structural prospects have been defined within the block with potential recoverable reserves ranging from 114 to 276 MMBO per prospect. A test well is planned for the fall of 1996.« less

Petroleum Laws and Model Contracting Terms – Production Sharing in China

Jurisdiction for China's petroleum administration has been separated with China National Petroleum Corporation (CNPC) vested with exclusive rights in the on-shore and China National Off-shore Oil Corporation (CNOOC) given exclusive jurisdiction off-shore. Both of these state companies have published model production sharing contracts which are similar in all material respects but which differ from the usual production sharing contract by incorporating taxation and royalty obligations in addition to production sharing arrangements in one document.